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Cheshires £1bn waste deal down to final two bidders

Contenders for Cheshire County Councils £1billion private finance initiative waste deal have been whittled down to two, Viridor Waste Management and a joint venture between United Utilities and Interserve. The announcement means that the Waste Recycling Group and a partnership between Shanks Waste Management with Ineos Chlor, which were on the shortlist of four bidders announced in April 2008, are out of the running.

The county already recycles about 47 per cent of its household waste, just 3 per cent short of its 50 per cent by 2020 target.

Viridor wants to build a central mechanical biological treatment plant, which will use proven technology to recover further recyclable materials from residual waste and produce solid recovered fuel. The SRF would be used as feedstock for the planned Ineos Chlor combined heat and power plant in Runcorn.

United Utilities and Interserve also plan to separate out recyclates from the residual waste first using sorting technologies then send the remaining waste through a proven gasification technology. This will produce electricity and heat, which will be used locally, and building aggregates. 

Public consultation
This summer, both bidders will submit detail planning applications covering technologies and proposed sites. These plans will be subject to a public consultation.
If the programme is approved, waste treatment facilities will take up to three years to build and could be operational by April 2013.

The council is expected to announce its preferred bidder in November.

Cheshire East Council environment executive member David Brickhill said: New technologies are needed to provide an option to landfill, which is being made increasingly expensive for taxpayers by the imposition of a steeply increasing Government tax programme.

During the summer we shall be closely examining all the implications of the proposals from Viridor and United Utilities - the benefits, costs and risks - before making a decision on this vitally important issue.

Who are the bidders?
* Interserve is a UK-based infrastructure services, maintenance and building group and a FTSE 250 company with a revenue of £1.7 billion.
* United Utilities is a UK listed water company, which owns, operates and maintains utility assets, including water, wastewater, electricity and gas. It is also a FTSE 100 company with a turnover of £2 billion.
* Viridor Waste Management is owned by the Pennon Group, a major British Plc focused on the water and waste management industries. As part of the Pennon Group, Viridor is a FTSE 100 company.

Cost and boundary changes
The council currently pays £6.4million in landfill tax each year. This amount is increasing by £8 per tonne in April, with implications for the soon to be created local authorities of East and West Cheshire when the county council splits in two in the same month. These two authorities could face fines of £150 per tonne if they fail to meet their landfill allowances.


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