MoreThanWaste.com - Delay in Greater Manchester PFI contract (10/09/2007)

"We are delighted with the progress and the excellent results that have come from the Preferred Bidder negotiations with Viridor/Laing against our hugely challenging service demands and timetable ambitions"

Cllr Neil Swannick the Chair of the Authority

The Greater Manchester Waste Disposal Authority (GMWDA) has announced that it will be attaining commercial closure for its waste PFI contract in September, but financial closure will be delayed until December.

Financial closure of the contract had earlier been delayed from June to September following an announcement by GMWDA on 2 July.

In January 2007 the Viridor/ Laing consortium was appointed as Preferred Bidder by the GMWDA, for the 25 year, £3 billion contract. The waste disposal authority deals with around 5% (around 1.4m tonnes) of the national total for municipal waste.

By July, planning approval had been received for the first of the major new facilities that is to deliver Greater Manchester’s waste management infrastructure. A further 23 approvals for facilities are required across Greater Manchester.

The Rochdale integrated waste facility (Picture: Viridor)

Proposed Rochdale facility

The proposed facility at Waithlands in Rochdale is to include an in-vessel composting (IVC) plant for the treatment of up to 25,000 tonnes of garden and kitchen waste, a Materials Recovery Facility (MRF) for the sorting of up to 65,000 tonnes of mixed dry recyclables and a new transfer loading station (TLS) for bulking up and onward transport of 65,000 tonnes of residual waste.

GMWDA is the largest of six English waste disposal authorities that were created under the Local Government Act 1985. GMWDA covers 958,000 households in Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside and Trafford.

The Authority says that “it has signed off the vast bulk of the waste management solution, agreed the detailed issues that need to be resolved in September, and agreed discussions with Viridor/Laing that will ensure that work on new facilities is progressed as if financial close had been secured in September”.

Outstanding issues

There are a number of issues that restrict September close to a commercial one only. GMWDA says that these are:

final agreement of detailed works associated with newly acquired sites,
“capturing” the contractual details in respect of the fuel use solution,
due diligence work undertaken by the consortium’s bankers, and
the submission of a Final Business Case to Government in relation to Private Finance Initiative (PFI) credit award, once closure has been reached.

INEOS Chlor Vinyls

GMWDA has previously announced its proposed use of a Combined Heat and Power (CHP) solution for its refused derived fuel (rdf) and also its associated with a CHP application by INEOS ChlorVinyls at Weston Point, Runcorn in Cheshire, as a possible supplier of rdf.

With a contract of this size, requiring 44 facilities, £300m of investment and said to be the largest waste related contract in Europe, it is clearly important that Greater Manchester gets the best solution for the local population. The authority understandably considers that it is achieving a reasonable deal to provide the solution to Greater Manchester waste challenges.

Speaking today in Manchester Councillor Neil Swannick the Chair of the Authority said:

“We are delighted with the progress and the excellent results that have come from the Preferred Bidder negotiations with Viridor/Laing against our hugely challenging service demands and timetable ambitions.

“Aside from achieving the ‘world class’ environmental solution we were seeking involving 44 facilities, £300 million of investment, and a contract price that will be more than £1 billion less than we expected to pay, I am delighted that Viridor/ Laing and the Authority have been able to agree in principle to the continued use of the Greater Manchester Pension Fund for existing employees who are in that scheme. This has made a high-class workforce solution better still.

“The Authority’s focus after the end of September will be on working alongside Viridor/ Laing to drive on with the construction programme. The Authority’s administrative arrangements will change at that time coinciding with the Authority’s current Director of Procurement completing his period of secondment from DEFRA as planned”.


	Delay in Greater Manchester PFI contract (10/09/2007) "We are delighted with the progress and the excellent results that have come from the Preferred Bidder negotiations with Viridor/Laing against our hugely challenging service demands and timetable ambitions" Cllr Neil Swannick the Chair of the Authority The Greater Manchester Waste Disposal Authority (GMWDA) has announced that it will be attaining commercial closure for its waste PFI contract in September, but financial closure will be delayed until December. Financial closure of the contract had earlier been delayed from June to September following an announcement by GMWDA on 2 July. In January 2007 the Viridor/ Laing consortium was appointed as Preferred Bidder by the GMWDA, for the 25 year, £3 billion contract. The waste disposal authority deals with around 5% (around 1.4m tonnes) of the national total for municipal waste. By July, planning approval had been received for the first of the major new facilities that is to deliver Greater Manchester’s waste management infrastructure. A further 23 approvals for facilities are required across Greater Manchester. The Rochdale integrated waste facility (Picture: Viridor) Proposed Rochdale facility The proposed facility at Waithlands in Rochdale is to include an in-vessel composting (IVC) plant for the treatment of up to 25,000 tonnes of garden and kitchen waste, a Materials Recovery Facility (MRF) for the sorting of up to 65,000 tonnes of mixed dry recyclables and a new transfer loading station (TLS) for bulking up and onward transport of 65,000 tonnes of residual waste. GMWDA is the largest of six English waste disposal authorities that were created under the Local Government Act 1985. GMWDA covers 958,000 households in Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside and Trafford. The Authority says that “it has signed off the vast bulk of the waste management solution, agreed the detailed issues that need to be resolved in September, and agreed discussions with Viridor/Laing that will ensure that work on new facilities is progressed as if financial close had been secured in September”. Outstanding issues There are a number of issues that restrict September close to a commercial one only. GMWDA says that these are: final agreement of detailed works associated with newly acquired sites, “capturing” the contractual details in respect of the fuel use solution, due diligence work undertaken by the consortium’s bankers, and the submission of a Final Business Case to Government in relation to Private Finance Initiative (PFI) credit award, once closure has been reached. INEOS Chlor Vinyls GMWDA has previously announced its proposed use of a Combined Heat and Power (CHP) solution for its refused derived fuel (rdf) and also its associated with a CHP application by INEOS ChlorVinyls at Weston Point, Runcorn in Cheshire, as a possible supplier of rdf. With a contract of this size, requiring 44 facilities, £300m of investment and said to be the largest waste related contract in Europe, it is clearly important that Greater Manchester gets the best solution for the local population. The authority understandably considers that it is achieving a reasonable deal to provide the solution to Greater Manchester waste challenges. Speaking today in Manchester Councillor Neil Swannick the Chair of the Authority said: “We are delighted with the progress and the excellent results that have come from the Preferred Bidder negotiations with Viridor/Laing against our hugely challenging service demands and timetable ambitions. “Aside from achieving the ‘world class’ environmental solution we were seeking involving 44 facilities, £300 million of investment, and a contract price that will be more than £1 billion less than we expected to pay, I am delighted that Viridor/ Laing and the Authority have been able to agree in principle to the continued use of the Greater Manchester Pension Fund for existing employees who are in that scheme. This has made a high-class workforce solution better still. “The Authority’s focus after the end of September will be on working alongside Viridor/ Laing to drive on with the construction programme. The Authority’s administrative arrangements will change at that time coinciding with the Authority’s current Director of Procurement completing his period of secondment from DEFRA as planned”.