Norfolk waste PFI project abandoned

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Norfolk waste PFI project abandoned

Plans to build a waste-to-energy incinerator plant through the PFI model at Kings Lynn have been abandoned after a Norfolk County Council voted in favor of terminating the contract on April 7th.

It was decided to terminate the project, even though the decision leaves the authority facing financial penalties of £30 million. This sum comprises compensation to the selected private partner Cory Wheelabrator of £20.3 million, contractor public inquiry costs of £1.6 million and exchange rate and interest rate related costs of £8.36 million.

The project has failed to secure planning permission despite 'calling in' the application in August 2012. The daily cost of the continuing delay costs the council around £140,000.

The council estimated that savings would amount to over £250 million over 23 years.

A joint-venture between Cory Environmental and Wheelabrator Technologies, a subsidiary of US giant Waste Management Inc, won the 25 year contract to build and run the plant, with the project achieving financial close in February 2012.

Financing was arranged with Royal Bank of Scotland, Lloyds Banking Group and Sumitomo Mitsui Banking Corporation.

The power and recycling centre, which was to be called the Willows Power & Recycling Centre, would have helped to change the way waste is managed in Norfolk. It would divert over 250,000 tonnes of waste from landfill per year as well as recovering enough energy to power around 36,000 homes. Metals and ash would also be recycled on site.

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