The extension to the deal, due to expire in 2024, was announced in a notice published by the council on 13 February, which valued the extension at £200 million.
This deal includes the operation of the Eco Park, waste transfer stations and community recycling centres for up to five years after the 2024 expiry date of the contract. During this time the council has the right to disaggregate and separately procure further services if it chooses to and the council also has an option to break the contract in 2027.
The notice arrived four days after Surrey separately commenced procurement for the processing of 150,000 tonnes per year of residual waste, currently handled by Suez.
Under the separate procurement, valued at £260 million, the council is proposing to divide the contract into four lots, which will each commence on the expiry of the current contract with Suez. The residual waste contracts will be for a duration of 10 years and will include an option to extend for a further 5 years.
Extension
Surrey and Suez first signed the contract valued at £740 million in 1999. This has been amended many times. In 2006, the contract was changed to include more recycling facilities rather than disposal (see letsrecycle.com story).
It was also amended in 2010 and 2013 to include the development of the Surrey Eco Park.
The delayed gasifier facility became operational in 2022, many years behind schedule. The pair had previously clashed over the facility, with legal proceedings taking place in 2021 (see letsrecycle.com story).
In the notice announcing the extension, the council explained that the delay to the gasifier coming online meant the ‘operational’ phase of the contract was shortened, and Surrey has therefore been unable to assess the operational performance.
“Accordingly, the authority requires additional time in order to determine the gasifier’s long-term commercial viability to enable it to determine its long-term waste disposal options,” the notice says.
The Eco Park, in Charlton Lane, Shepperton, now treats all of Surrey’s collected food waste, and black bag waste from Spelthorne, Runnymede and Elmbridge, generating enough electricity to power over 4,000 homes per year.
A soft market engagement carried out by Surrey in 2022 “indicated no commercial interest in operating gasification technology at the EcoPark,” the notice added. Suez operates the facility on behalf of the council under the contract.
Surrey council added in the notice that it “also notes the regulatory uncertainty in the waste sector….borne by the potential introduction of several amendments to the legal framework governing waste disposal which are due to take effect and/or be implemented in the next five years.”
I am delighted that with the legal dispute resolved and facilities working well
- Natalie Bramhall, Surrey county council
‘Key’
Natalie Bramhall, cabinet member for property and waste at Surrey county council said: “The Eco Park is a key part of Surrey County Council’s ambition to be one of the UK’s leaders when it comes to recycling and sustainability.
“We are proud to already be the third best performing county council in England for recycling and committed to doing even more to improve recycling rates and reduce residual waste volumes further over the next decade.
“The Eco Park provides vital services for local residents and I am delighted that with the legal dispute resolved and facilities working well, we can look to the future and expanding its offering for the benefit of local communities.”
Procurement
The new procurement for the treatment of 150,000 tonnes of waste will begin once the contract with Suez expires in 2024, the council said.
This is split into four lots comprising of two for 20,000 tonnes a year, one for 40,000 tonnes and another 70,000.
Surrey said the tonnage is based on current estimates as household residual waste volumes is anticipated to remain largely consistent, despite population growth, due to forthcoming legislation and initiatives within the waste market, such as extended producer responsibility and the deposit return scheme.
History
Surrey has had a long and chequered history with EfW plants. The council turned down planning permission for an EfW plant near Guildford in December 2001 (see letsrecycle.com story). The plant, which was designed to handle about 225,000 tonnes of waste a year, was proposed by Thames Waste Management.
The proposal to build a 110,000 tonnes-a-year capacity incinerator at Capel was subject to a legal challenge in the High Court in February 2009 (see letsrecycle.com story).
Subscribe for free