GCC throws extra £17m at incinerator
The cabinet of Gloucestershire County Council (GCC) voted unanimously in support of the payment as protests were held outside its headquarters in Gloucester yesterday (11 November).
It argued that the £17 million one-off financial contribution to the residual waste project, funded from revenue reserves, would mitigate the cost of delay in the annual revenue budget for the project over 25 years.
GCC expects its contract with UBB to generate savings in excess of £150 million over its 25-year life, and Cllr Mark Hawthorne, leader of GCC, claimed that the payment would provide value for money, as the saving would free up funds for long-term frontline services.
The council’s Liberal Democrats have submitted a legal challenge against the Conservative cabinet’s decision, asking why the decision was not put to a full council vote. The challenge will halt the progression of the agreement until members of the Overview and Scrutiny Committee can meet to review the process.
Incinerator’s complicated history
GCC first awarded the contract for the treatment of residual waste to UBB in 2012, commissioning the company to design, build, finance and operate the incinerator at Javelin Park. Construction was scheduled to begin in the summer of 2013, with services commencing in 2016, but the council’s planning committee refused planning permission, sparking an appeals process that only ended in July this year.
Following the planning committee’s ruling that the facility’s technology would be ‘antiquated’ and ‘inflexible’ by the end of the contract, UBB appealed and in January this year then-Secretary of State Eric Pickles approved the plans. Stroud District Council then lodged a legal challenge of its own regarding Pickles’s ruling, which was only rejected by the High Court in July after several deferrals.
Though the contract anticipated the risk of delay, it included a mechanism meaning that UBB must set out a revised project plan and timeline following a delay of two years or more, meaning the two-year hiatus has resulted in increased project costs for the council.
A report into the issue presented at yesterday’s cabinet meeting stated that making the one-off payment would ‘provide the council with better value for money’ explaining that ‘the approach is equivalent to reducing one’s mortgage repayments, by making a lump sum contribution’.
GCC has previously made a £13-million payment to the project, funded from the Strategic Waste Reserve.
Council divided on payment decision
Councillor Ray Theodoulou, Deputy Leader of the Cabinet and Cabinet Member for Finance and Change, said: “Disposing of Gloucestershire’s rubbish that can’t be recycled in a clean and efficient way while generating electricity at the same time will save taxpayers money, support our aim of 70 per cent recycling and make a massive reduction in Gloucestershire’s carbon emissions. Now the end is in sight, we could finally start work on building the facility that will help us stop burying our household waste in Gloucestershire once and for all.”
In opposition, Liberal Democrat county councillor Chris Coleman, who is also the cabinet member for Clean and Green Environment on Cheltenham Borough Council, said: “This council is taking a huge reputational and financial risk and it’ll be the taxpayers who will bear the brunt.
"The Conservatives have had plenty of opportunity to do the right thing and stop this unwanted and grossly expensive scheme. Across the county, residents know that there are other technologies that are better for the environment, health and the economy but time and again the Conservatives have ignored these alternative ways to deal with waste.
"It is a ludicrous and never-ending saga that is seeing taxpayers’ money literally going up in smoke.”
Opposition plans progressing
Plans for the R4C (Resource Recovery, Refining and Recycling Centre), which supporters claim will provide a ‘more safe, cost-effective and sustainable’ waste solution than the incinerator, were launched in August.
Ahead of the cabinet decision to provide the extra payment to UBB, Tom Jarman, co-founder of the Community R4C project, sent a letter to Cllr Hawthorne, highlighting that after launching this summer, the project’s mechanical biological and heat treatment (MBHT) facility would begin construction in the second quarter of 2016, with operations scheduled to commence in late 2017.
Jarman confirmed that the group had held talks with district councils about processing municipal waste and local operators about commercial and industrial waste as well as developing a community bond finance strategy with support from ‘major investors’.
He said, in the letter: “It is clear that the opening of our MBHT plant will fundamentally alter the financial landscape for waste management in Gloucestershire, with real implications for the commercial viability of the proposed incinerator.”
When construction on UBB’s Javelin Park incinerator (part of GCC’s £500-million contract with the Spanish-owner firm) is completed, now expected some time in 2019, the developer claims it will divert over 92 per cent of the county’s residual waste from landfill, reducing its CO2 emissions by over 400,000 tonnes and generating enough electricity to power 25,000 homes. In addition, around 300 new jobs are expected to be created by the construction process, with 40 jobs being delivered over the 25-year period of the service.
The £15-million R4C, however, expects to reduce carbon emissions by 114,000 tonnes and provide nearly 90,000 more tonnes of both renewable biomass and ‘high-grade’ recyclates.