Controversial waste P3 in Houston awarded to FCC

Controversial waste P3 in Houston awarded to FCC

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Houston City Council has awarded FCC Environmental Services, the American environmental services subsidiary of the FCC Group, the contract to design, finance, build and operate the plant that will sort, recover and market all the city’s recyclable materials for 15 years, extendable up to 20 years. The expected contract value is more than US$250 million, including the sale of recovered materials from Houston and from third parties.

The plant is planned to treat 120,000 tonnes per year with a maximum capacity of 145,000. The process line will be fully automated and will be equipped with the latest materials separation technologies. The collection vehicle fleet owned by the city of Houston will carry the mixed recyclable materials from the selective collection bins to the FCC facilities which will process and commercialise all the city’s recyclables exclusively.

FCC will take over the city’s recycling processing in approximately 14 months, when it is scheduled to complete construction of a US$23 million processing plant that will employ 100 to 140 people in northeast Houston. Upon completion FCC will give the plant to the city. This coincides with the expiration of the current recycling contract.

This brings to an end a difficult and controversial tender process. Prior to the current Mayor taking office in January 2016, an innovative One Bin contract was proposed and its proponent, a company called EcoHub, was selected as the winning bidder to provide the city's recycling services. 

The One Bin proposal involved collecting all trash, recycling and yard waste in one bin and recycling up to 75% of it.  The company would then sell the recycling materials for new products. EcoHub's ultimate ambition is to eliminate the need for landfill.

Despite the seemingly huge environmental advantages of the scheme and recommendations from City of Houston staff, including the Chief Development Officer, the Mayor did not finalise the award. Instead, a two-year interim recycling contract with Waste Management was announced in March 2016, and a Request for Proposals for the P3 contract was released in October.

FCC was selected as the city’s new recycling provider in June 2017 but bids for the contract were reopened to FCC and three other companies (Waste Management, Republic Services and Independent Texas Recyclers) about a month later due to council-members’ concerns.

EcoHub filed a lawsuit against the City in August 2017 in an attempt to gain more information about the sudden termination of the One Bin contract. The company has accused public authorities of rigging the tender process.

Following this, in September Houston was struck by Hurricane Harvey, suspending recycling services entirely and all work being done to progress the tender.

Furthermore, the award comes after the city council twice delayed formally approving the contract in the last few weeks. Thus, the significance of this development in FCC's favour cannot be underestimated.

This is the ninth contract won by FCC Environmental Services in the USA. The first contracts achieved in Texas were the transport of bio-solid wastes in the city of Houston, the construction and management of the new Materials Recycling Plant (MRF) in the McCommas Bluff Landfill facilities south of Dallas and the treatment and commercialising of all the recyclable materials for the city of University Park.

In 2017, the company won three new contracts in Texas, in the cities of Mesquite, Garland and Rowlett. FCC also won two contracts for the collection of solid urban municipal wastes in Polk County and Orange County, both in the state of Florida.

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