Two large waste private finance initiative (PFI) schemes are expected to reach financial close in September.
Wakefield Council is planning to finalise its £750m waste PFI contract for recycling, autoclave and anaerobic digestion facilities at South Kirkby this autumn, five years after a preferred bidder was chosen.
As MRW revealed in June, the council is seeking Green Investment Bank (GIB) funding to bring the project to close. The council would not comment on how much it had received from the GIB.
The deal was originally expected to be completed in 2010 after VT Group was chosen as preferred bidder for the contract in 2007. But the company was bought by Babcock in 2010 after the recession pushed back the contract signing.
Waste firm Shanks was then chosen to partner with Babcock to complete the PFI deal in February this year. But this was again delayed because of changes in the preferred bidder, according to the council.
Leeds City Council’s £550m waste PFI deal is also set to reach financial close in September. A planning application was submitted earlier this month by Veolia Environmental Services (VES), which was chosen as preferred bidder in January.
The scheme has been granted £68.6m in PFI credits, with the rest of the funding coming from VES. The company will build a waste recycling and energy recovery plant in the East Leeds Cross Green Industrial Area.
Other waste PFI schemes have reached financial close recently. Last month, Essex County Council and Southend-on-Sea Borough Council signed a joint 25-year contract with a consortium of Urbaser and Balfour Beatty on the PFI-funded scheme.
The Barnsley, Doncaster and Rotherham waste PFI contract, with a partnership formed of Shanks Group and Scottish and Southern Energy, was finalised in March and planning permission was granted in April.
The scheme is funded by Lloyds and SMBC banks.
But funding for some waste PFI projects received a blow when the chancellor axed PFI funding for seven schemes in the Spending Review in 2010, while 11 schemes retained the credits.
In April it emerged that the GIB could be used to bail out larger waste PFI schemes that were struggling. A bank official admitted it was “disappointing” that the bank would be used in a way which could freeze out smaller, more innovative schemes.
PFI funded waste schemes - (PFI contribution in brackets)
BARNSLEY, DONCASTER AND ROTHERHAM
Value: £750m (£77.4m)
Financial Close: March 2012
Preferred bidder: 3SE (Shanks Group and Scottish and Southern Energy)
Planning: permission granted April
Operational: summer 2015
BRADFORD AND CALDERDALE
Value: £170m (£62.1m)
Financial close: N?A
Preferred bidder: Pennine Resource Recovery (Skanska/aecom)
Planning: submitted May 2012
ESSEX AND SOUTHEND-ON-SEA
Value: £800m (£100.9m)
Preferred bidder: Urbaser BB
Financial close: June 2012
Planning: application submitted March 2012
Value: £800m (£115.3m)
Preferred bidder: Veolia
Financial Close: July 2011
Planning application: end of 2011
Operational: April 2015
Value: £550m (£68.6m)
Preferred bidder: Veolia Environmental Services
Financial close expected this September
Planning: application submitted July 2012
Operational: end of 2015
MERSEYSIDE WASTE DISPOSAL AUTHORITY AND HALTON
Value: N/A (£90m)
Preferred bidder: between Kovanta and Sita, to be announced in autumn
Financial close: N/A
Value: £500m (£91m)
Preferred bidder: Cory Environmental and Wheelabrator Technologies
Financial Closure: N/A
Planning: on hold pending government decision
NORTH YORKSHIRE AND CITY OF YORK
Value: £900m (£65m)
Preferred bidder: Amey Cespa
Planning: submitted September 2011
Financial Close: N/A
SOUTH TYNE AND WEAR WASTE PARTNERSHIP
Value: £727m (£73.5m)
Preferred bidder: SITA led consortium
Financial Close: April 2011
Planning: permission granted 2008
Operational: April 2014
SOUTH WEST DEVON WASTE PARTNERSHIP
Value: £200 (£95m)
Preferred bidder: MVV Environment Devonport
Planning: permission granted February 2012
Financial close: March 2011
Operational: November 2014
Value: £1bn (£122.4m)
Preferred bidder: Veolia
Financial close: July 2012
Planning permission: granted February 2011
WAKEFIELD CITY COUNCIL
Value: £750m (£33m)
Preferred bidder: Shanks/Babcock
Financial Close: expected mid September
Operational: end of 2014