A full meeting of Norfolk County Council has backed a motion to withdraw from its contract with Cory Wheelabrator by 49 to 30, with one abstention.
An emergency meeting had been set up to decide on the fate of the Willows scheme after a report warned the authority could not afford the scheme being held up by communities secretary Eric Pickles.
Pickles was supposed to have ruled whether to grant planning permission for the facility on or before 14 January, but has so far remained silent.
As a result the council faced escalating compensation costs.
The council’s cabinet committee has also unanimously rubber-stamped the decision.
A council statement read: “The cost of terminating the contract is estimated to be £30.26m, comprising capped compensation to Cory Wheelabrator of £20.3m, contractor public inquiry costs of £1.6m and exchange rate and interest rate related costs of £8.36m.”
The costs are to be met through a dedicated £19m contingency reserve, £3m from the council’s underspend from 2013/14 and £8m from general reserves.
The cabinet committee will meet on 12 May to consider how to take ‘immediate steps’ to replenish the authority’s reserve fund.
A spokesperson for the Cory Wheelabrator consortium said: “”We are extremely disappointed by the decisions today, particularly as many years of hard work have gone into this project by the consortium and Norfolk County Council. We believed that the public inquiry would have provided a fair hearing for all parties and that a decision would be based on pure planning grounds.
“We, and the industry, have also made it clear to Government that planning delays to major infrastructure projects are costly and can jeopardise future investment. The Willows project looks set to become yet another example of this delay and uncertainty.
“The delay to that planning decision has resulted in considerable costs to all parties at a time when public funds are already stretched.”
Following the vote Richard Coke, leader of the council’s UKIP group, said: “The £30m [compensation] will ultimately be dwarfed by the savings achievable with a cleaner, greener system.
“The Norfolk MPs must now make good their undertaking to assist the council in lobbying for capitalisation of the £30m and any other financial assistance that maybe forthcoming.”
King’s Lynn & West Norfolk Borough Council has long been opposed to the Willows EfW project. Council leader Nick Daubney said: “This became the only sensible outcome and Norfolk County Council have made the right decision today.
“Now we have a great opportunity to come together – districts, county and MPs - to find real, workable, long-term solutions to deal with waste in Norfolk and increase recycling.”