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North London waste and energy project reaches final stages of procurement

The North London Waste Authority (NLWA) has today announced its shortlist of bidders for its waste services and fuel use contracts that are estimated to be worth between £3bn and £4bn.

The project is split into two contracts with FCC/Skanska and Veolia shortlisted for the waste disposal services contract, which includes production of a solid recovered fuel from waste that cannot be recycled or composted, and EOn/Wheelbrator and Veolia shorlisted for the contract that involves the use of that fuel.

As a result of the tendering process and latest decision, the Authority along with Covanta will no longer pursue their proposed fuel use solution in competition with the shortlisted firms’ proposals.

“The procurement and the market’s response has been a great success to date despite the withdrawal of Government PFI funding part way through which has delayed the project by a few months,” said NLWA chairman councellor Clyde Loakes.

The Authority’s procurement process and timetable envisage a final stage of dialogue with final tenders being submitted in the autumn, the selection of Preferred Bidders in December and financial close in June 2013.

At a glance

The North London Waste Authority (NLWA) is the UK’s second largest waste disposal authority, handling just under 1M.t of municipal waste — around 3% of the UK total — collected in the seven London Boroughs of Barnet, Camden, Enfield, Hackney, Haringey, Islington and Waltham Forest.

The procurement was initiated under an OJEU notice published on 21 April 2010. It is for the provision of future waste disposal services and investment in new facilities. The two contracts together are potentially worth £3bn to £4bn in nominal terms over a 25-35 year period. They are expected to involve investment of £500M to £600M in new facilities.

The project was approved for a record £258.4M PFI credit support by Government in March 2010 . This support was reviewed and confirmed in July 2010 and then subsequently withdrawn as part of the Comprehensive Spending Review in October 2010.

The Waste Services contract potentially involves the provision of recycling, composting, residual waste treatment, transport and Household Waste & Recycling Centre services. Key facilities are likely to be located at sites in Edmonton in Enfield, Hendon in Barnet, Hornsey Street in Islington and at Pinkham Way in Haringey.

The Fuel Use contract is for the production of renewable energy from Solid Recovered Fuel.

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