Sinfin EfW compensation to be decided in court

The contract with RRS (Derbyshire) Ltd – a partnership between infrastructure firm Interserve and waste management company Renewi – was signed in 2009 and reached financial close in 2014.

It included managing Derby’s recycling centres, providing five transfer stations and building and running the 190,000 tonnes-per-year gasification plant in Sinfin, Derby.

In August 2019, the council terminated the contract on account of contractor default, namely a failure to pass contractual acceptance tests in relation to the construction of the Sinfin gasifier (see letsrecycle.com story).

In February, the councils announced they would repair the failed Sinfin gasification plant and use it to treat residents’ residual waste (see letsrecycle.com story).

We believe that we’re in a better position as a result of the applications and judgment

• Derbyshire city and Derbyshire county councils

Costs

RRS claims it is owed £186.6 million, while the councils say there are owed £9 million. A full seven week hearing is due to take place next year to determine the compensation, known as adjusted estimated fair value (AEFV).

Ahead of the court date, the council sought a summary judgment seeking to clarify how the AEFV is calculated and for RRS’ claim to be adjusted.

In a ruling handed down on 28 March, Mr Justice Constable ruled that the AEFV should be addressed by the courts, thus dismissing the request for summary judgment. However, he made an award of costs in the councils’ favour for the changes made to RRS’ claim and made an early determination that 40% of RRS’ costs of preparing its reply document will be disallowed.

A spokesperson for Derby city council and Derbyshire county council said: “Administrators for RRS have chosen to have the Adjusted Estimated Fair Value decided through the courts.

“We believe that we’re in a better position as a result of the applications and judgment and we are robustly defending RRS’ claim to protect the interest of Derby and Derbyshire council tax-payers.”

The legal team for RRS declined to comment.