Two councils have revealed that they have withheld £50m from a controversial delayed incinerator project and have warned they may cancel the contract entirely.
Derbyshire County Council and Derby City Council said in a joint statement that they had not yet paid £25m each due towards the incinerator, being built by Interserve for Renewi at Sinfin, Derbyshire.
Interserve, which is in the process of leaving the waste market, and Renewi formed a joint venture called RRS to develop the project to handle 190,000 tonnes a year of waste.
The councils said they were both “putting added pressure on their contractors and considering all options to get a waste treatment centre in Sinfin up and running”. It was supposed to have opened in 2017.
They said their options included ending their joint long-term waste management contract with RRS, but that “while they are encouraged by the recent actions and progress made by RRS, both councils want to see an urgent completion of the facility”.
Both said they remained confident that the incinerator was still better value than sending waste elsewhere.
Neither has paid the £25m because a clause in the contract means it is not due until the facility has passed certified performance tests.
Derby leader Chris Poulter, who last year survived an attempt to oust him over the project, said: “The fact that the plant has still not passed certified performance tests is clearly of concern to us because we need a facility to give us certainty about the future cost of dealing with Derby and Derbyshire’s waste.
“We have a duty to protect the interests of council tax-payers, and are in weekly talks with our contractors and the banks which loaned them the money for the project. We’re pushing them hard to resolve outstanding issues at the plant and pass certified performance tests as soon as possible.”
Derbyshire’s deputy leader Simon Spencer said ending the RRS contract was possible but would be “a last resort”.
An RRS spokesperson said: “We continue to work with the councils and all other project stakeholders to bring the Derby Waste Treatment Centre into full service.”
The plant has handled a limited amount of waste, but the work provoked 259 complaints from the public, mainly concerning smells and noise.
Answering a question last week from Labour councillor Nadine Peatfield, Jonathan Smale, Derby’s Conservative cabinet member for communities, neighbourhoods and streetpride, said: “The Environment Agency continues to monitor the site and all reports are looked into to see if they can be attributed to the site and, if so, what the cause was.
“There is a current repair being undertaken on one of the lines, and Interserve continues to carry out work on the site while we await the outcome of the acceptance tests.
“Depending on the outcome, we will then know if the tests have to be undertaken again or the project moves on to the next phase of testing.”