Greater Manchester will begin looking to replace its troubled waste management PFI deal next month after a £3bn, 25-year contract was terminated early.
Greater Manchester Waste Disposal Authority’s (GMWDA) contract with Viridor Laing ended on 29 September this year and a new opportunity will go to the market next month in a bid to make “significant efficiency savings” and “operational improvements”.
Costain, which was sub-contracted by Viridor Laing to design and build a network of 42 waste facilities across the region, announced in August that it would exit the contract.
GMWDA is now looking to procure Greater Manchester waste and resource management services including residual waste management services, household waste recycling and transfer services, bio-waste management services and all associated works.
The deal will incorporate five residual waste sites, 20 household waste recycling centres, eight transfer loading stations, the Bolton Thermal Recover Facility, the Materials Recovery Facility a number of bio-waste facilities and the obligation to produce refuse derived fuel and associated rail transport and suppy to the Runcorn Thermal Power Station.
The authority said the previous contract had cost £165.88M per year, and that savings had to be made due to shrinking local government budgets. The GMWDA predicts that the total savings from the new deal will be £37M per year from April 2019.
The previous contract, which was the largest of its kind in Western Europe, has been fraught with issues. Costain’s Natural Resources division incurred an operating loss of £2.6M in the first half of 2014 and the firm pulled out of the waste sector entirely shortly after.