The South Tyne and Wear Waste Management Partnership has revealed a shortlist of three bidders for its waste management private finance initiative project.
The waste firms that will compete for the 25-year £1.3 billion scheme are:
* MVV Umwelt
* Sita UK
* United Utilities
Five other contenders have been ruled out. They were:
* Graphite Resources
* VT Environmental
Gateshead, South Tyneside and Sunderland City councils are working together as the South Tyne and Wear Waste Management Partnership to double recycling rates to 50 per cent by 2020 and find a treatment solution to deal with the rubbish that is left. It hopes to build an EfW facility capable of processing 200,000 tonnes per annum with potential for combined heat and power.
The Department for Environment, Food and Rural Affairs allocated £73.5 million in PFI credits to the partnership in July 2008.
The new plant is set to be up and running in 2014.
Partnership spokesman John Robinson said: Landfills are not good for the environment and the cost of landfill is rising, which ultimately comes out of our residents council tax so we have to find alternative ways of managing waste.
Reducing, re-using and recycling as much of our rubbish as we can is our priority but there will still be rubbish that remains and we have to find more sustainable ways of handling it.