Norfolk presses ahead with King's Lynn incinerator
Norfolk County Council’s Cabinet has today (29 October) agreed to press ahead with plans to build an incinerator in the area, despite government withdrawing funding for the project.
The future of the £500m energy-from-waste (EfW) plant came into question last month, after the Department for Environment, Food and Rural Affairs (Defra) announced it was to pull £169 million of Private Finance Initiative funding (PFI) from Norfolk County Council’s (NCC) Willows Power and Recycling project.
However, a report by the council’s Director of the Environment, Mike Jackson, and interim Head of Finance, Peter Timmins, found that rejecting the plan would ‘trigger an obligation for the County Council to make a payment of £20- £30 million within weeks of their decision, which would effectively bankrupt the council’. Further, professional services firm Price Waterhouse Cooper estimates that if the council were to go ahead with the plans now, but pull out at a later stage, they could face compensation costs of up to £100 million.
The Cabinet meeting follows on from one held by the full council yesterday (28 October), which saw 40 councillors vote in favour of the motion, with 38 against. Six county councillors were absent. The councillors had recommended that the Cabinet ‘accepts and acts on their decision’.
Speaking of the decision, Paul Green, of the Cory Wheelabrator consortium behind the incinerator project, said: 'The consortium is pleased that Norfolk County Council's Cabinet has today voted to accept the Revised Project Plan.
“We believe that the Willows Power & Recycling Centre will provide a long term sustainable solution to deal with the county's residual waste."
'No requirement to declare technical bankruptcy'
However, councillors in favour of scrapping the incinerator said the money could be found from reserves and by capitalising the compensation payments.
Speaking to Resource, Green member of Norwich City and Norfolk County Councillor for Nelson ward, Dr Andrew Boswell, said: “A group of councillors, backed by advice from the Department of Communities and Local Government, believe that there would have been absolutely no requirement to declare technical bankruptcy (Section 114) or reduce services from the revenue budget on the scale suggested.
“The council had £236 million of reserves in March, and we strongly argued for General Balances and Reserves to be used to fund withdrawing from the contract now without harming front-line services. The council officers gave different advice which, in part, led to the decision to continue the contract.”
Boswell added that he is ‘extremely concerned’ that despite the fact a contract break was on the council ‘risk register’, ‘no funds were built up for the necessary contract breakage compensation costs’.
He added: “The administration who signed the contract seemed oblivious to the possibility that there might be planning failure.”
The contract for a 250,000 tonne capacity energy-from-waste (EfW) facility at Saddlebow, King's Lynn was awarded to the Cory Wheelabrator consortium last year. Planning permission for the £500 million Willows Power & Recycling Centre was granted by the council last June, and once completed, the project was expected to process up to 250,000 tonnes of waste a year and power over 36,000 homes.
A Public Inquiry into the planning application for the Willows Power and Recycling Centre ran from 26 February to 17 May, following a decision by the Secretary of State for Communities and Local Government to call in the planning application for his decision. It is expected that the Secretary of State will issue his decision on the planning application by 14 January 2014.
Green added that Cory Wheelabrator now 'looks forward to the Department for Communities and Local Government making a swift planning decision'.
The project history has already been full of contention and drama, and Norfolk County Councillor and supporter of the project, Derrick Murphy, resigned earlier this year after sending a discrediting email to BBC Radio Norfolk about Leader of King’s Lynn and West Norfolk Council and opponent of the incinerator, Nick Daubney.
A revised plan has now been accepted by the Cabinet, which refreshes the contract dates for the project to ‘address the delay in securing planning permission which arose after the Communities Secretary called in the planning application for his determination’.
In order to proceed, the project still requires planning permission, which will be determined by the Secretary of State for Communities.
Defra PFI withdrawal
King’s Lynn becomes the latest project affected by Defra’s reversal in stance, after it revoked a total of £217.1 million of funding from three waste PFI projects in February, finding that the 29 projects that already had funding were ‘sufficient’ to meet the EU’s 2020 landfill diversion targets. It is for this same reason that the Saddlebow incinerator is having its funding withdrawn.
North Yorkshire County Council’s Allerton Waste Recovery Park project and waste management plans for Bradford and Calerdale Councils and Merseyside were affected by the previous withdrawal, and have now submitted an application to the High Court asking for a judicial review into the decision.
Read more about the Willows Power and Recycling Centre