Willows Power and Recycling Ltd – a consortium between Cory and Wheelabrator – had agreed a £600m contract with Norfolk county council in 2012 to build and operate an EfW plant at the Willows Business Park near King’s Lynn. But, political wrangles and planning difficulties saw the deal terminated in May 2014.
As a result of the termination, Norfolk was contractually required to pay Willows for sums it had incurred in developing the project.
And, in a statement issued today (December 1), Norfolk county council said it had “agreed a full and final settlement” of £33.7 million and welcomed what is called closure to a “sad and sorry saga”.
However, commenting on the agreement, the consortium was quick to point out that it is still “millions of pounds” out of pocket and that Norfolk still has no long-term solution for managing residual waste.
A spokesman for the consortium said: “Nobody has benefitted from the terms of the settlement agreement and the consortium remains millions of pounds out of pocket. More importantly, Norfolk, its councils and taxpayers still need to invest in a proven long-term solution to their considerable residual waste problems.”
Payment
Norfolk county council explained that the £33.7 million sum was in line with that reported to the council in May 2014 and that some payments had already been made. A last payment of nearly £5.9m was made on Friday (November 28).
Tom McCabe, interim executive director of community and environmental services at Norfolk county council, said: “We built up a reserve in order to pay the substantial costs of terminating the contract and we have now made a final settlement in line with that.
“The costs associated with ending the contract are significant and we have had to satisfy ourselves that they are justifiable, which is why this process has taken some time.”
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George Nobbs, leader of Norfolk county council, said that he welcomed the “certainty” that the agreement brings.
He commented: “This is a significant act of closure in a sad and sorry saga which was not of my administration’s making or choice. I very much welcome the fact that this now finally removes any risk of further costs being incurred in the future. However, it has been a salutary lesson of how not to do things. It is a matter of deep regret to me that this matter has caused so much damage to relations within our county and I hope that today we can all turn to a new page.”
In a statement, Willows Power and Recycling said: “As a result of the termination, Willows was contractually entitled to payment by Norfolk of compensation for sums it had incurred in developing the project referred to in the contract as the Force Majeure Termination Sum.”
The consortium added: “Norfolk and Willows have been in discussion about the calculation of that compensation and have reached agreement in relation to the calculation and payment of the compensation in accordance with the terms of the contract.”
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