Leicester Drops Long-Term Project Over Shifted Economy

21 July 2011

Leicestershire county council is set to ditch the procurement of its £685m long-term residual waste treatment project, claiming it is now unaffordable due to the withdrawal of PFI support in 2010

The county council's Cabinet will meet next week to approve plans to halt the project - the construction of a treatment facility for up to 180,000 tonnes-a-year of household residual waste at a site at Bardon, to the North East of Leicester.

The local authority claimed that last month's announcement in the Waste Review that the LATS scheme is set to be scrapped after 2012/13 had also influenced its decision because it meant it would not have to meet any specific landfill diversion targets until 2019/20.

But, it said that these long-term targets, as well as national, regional and its own waste management strategies meant there was still a need to explore as-yet-unspecified "proposals that will deliver alternatives to landfill disposal".

Just two bidders were left in the running for the Leicestershire contract when Defra decided to withdraw the £86.6m of PFI credits it had earmarked for the project as part of last year's Spending Review.

Of those, the Osiris Consortium - involving Shanks, Costain and John Laing - had proposed to build a mechanical biological treatment facility producing refuse-derived fuel at the Bardon site, while Veolia ES Aurora proposed an energy-from-waste facility.

The council's cabinet member for waste management, Richard Blunt, said: "We have one of the best recycling rates in the country and remain committed to driving down the amount of waste sent to landfill.

"Since we embarked on this project, the economy has shifted and there are planned changes in national waste policy. The financial climate has put huge pressure on public spending and the loss of the credits adds considerable costs to the project."

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Darrel Moore