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MRWA stands firm on Sita preferred bidder for huge contract

The Merseyside Recycling and Waste Authority (MRWA) has said it is determined to back Sita as the preferred bidder for a 30-year £1.18bn waste contract despite pressure from the Mayor of Liverpool and a local MP.

The Sita scheme includes an energy from waste facility with CHP at the Wilton International site on Teesside, creating around 50 new permanent jobs. It also includes a new rail hub for the transportation of waste at the existing Potter Group Rail Freight Terminal at Kirkby on Merseyside creating around 25 new permanent jobs.

After MRWA announced Sita as its preferred bidder in April, ahead of Covanta, the decision was criticised by Liverpool Mayor Joe Anderson who told the Liverpool Echo: “I feel the city and the wider city region has had a massive opportunity for major infrastructure investment snatched from its grasp and hundreds of potential jobs which we desperately need have gone to the north east.”

He was also disappointed not to have been consulted on “such as huge decision”, especially as Liverpool contributed more to the MRWA than any other authority.

A complaint from Andrew Miller, the MP for Ellesmere Port and Neston followed in June. He wrote a letter to MRWA asking the authority to reconsider its decision.

Miller said giving the contract to Covanta could have generated around 700 jobs in his constituency - 600 construction jobs and almost 100 permanent jobs at Ince Park, Ellesmere Port.

The MRWA said in a statement: “This stage of the process has been completed through a competitive procurement exercise, with the shortlisting and evaluation of two final tenders from Covanta and Sita. The project has the support of all six district councils that form the Merseyside and Halton Waste Partnership.”

It added that the tendering exercise “was scrutinised by the nine elected members who are councillors from the constituent district councils that make up the Merseyside Waste Disposal Authority governance structure”.

Jobs for Ellesmere Port lost

John Whittaker, chairman of development giant Peel Holdings, backed the MP, saying: “Over time, our planned joint venture at Ince Park [illustrated, above], Ellesmere Port with Covanta has the scope to create over 2,000 construction jobs and up to 3,000 operating jobs.”

“Only last week, we heard that this area stands to lose 200 million Euros in European aid and its councils face a further 10% of cuts from central Government,” Whittaker added.

He called for the waste authority to “reconvene, without prejudice, and look again at their processes”.

Cost-effectiveness disputed

MRWA said the proposed Sita contract will bring savings of £145m to the authority and its partner councils over current landfill costs.

But Miller claimed that Covanta’s bid would save the authority an extra £210m over the £145m in the Sita bid. He sought reassurance from the MRWA that the Sita bid is the most cost-effective.  

He continued:  “I am concerned that we risk missing a really significant opportunity for my constituency and benefits for the regional economy. Trucking Merseyside’s waste across the country to Teesside for treatment is, to say the least, counter-intuitive.

MRWA countered that the Sita bid will “provide a sustainable and cost effective solution for 430,000 tonnes of municipal waste per year, which the authority handles and which has not been recycled.”

A spokesperson for MRWA told MRW: “There are no current plans to diverge away for the current strategy, which is to go from preferred bidder to financial close.” Financial close is due in late 2013/ early 2014.

MRWA stated it will, through the Sita contract, “divert more than 90% of Merseyside and Halton’s residual waste away from landfill, and will ensure that this region complies with its requirements under the European Union Landfill Directive”.

  • Covanta Energy has warned it could pull out of its operations in the UK, MRW reported in May. The world’s largest operator of energy-from-waste facilities (EfW) blames the move on the recent failure to win preferred bidder status in the Merseyside Recycling and Waste Authority’s 30-year municipal contract.

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