To consider the proposals being made by Mercia Waste Management for the treatment of residual waste.

The Cabinet Member Major Contracts presented the report of the Head of Special Projects and advised Cabinet that the report followed on from the report of 16 February this year when all legal parameters were set out.  The following points were made in discussion:

·         The Cabinet Member stated that the planning and technical parameters had been achieved, and that attention now needed to be given to the costs for the build as it was felt that the financial parameters, and particularly value for money, could be improved.  The Cabinet Member added that this report outlined the need to investigate the different opportunities open to the authority for funding, which had not been previously available. 

·         Enabling works were being carried out on the site at Hartlebury and were being funded by Worcestershire County Council (WCC). 

·         WCC have considered a similar report to this one and had unanimously accepted its recommendations. 

·         Mercia Waste Management has started a tender process for the Plant at Hartlebury and are identifying preferred contractors.  Herefordshire Council have engaged their own independent financial advisors (KPMG) to ensure the proposal represents value for money for Herefordshire. 

·         To ensure the financial parameters are met – officers along with independent advisors would like to investigate the value for money element and alternative methods of funding.  The authority would also look to obtain the best Contractual and Technical advice possible with regards to any PFI proposal.

·         In response to a question by the Chairman of General Overview and Scrutiny with regards to the breakdown of scores and ranking as outlined on page 43 of the report, Cabinet was advised that these would be provided when Cabinet comes to make its final decision.  Cabinet unanimously agreed the recommendations before them.

RESOLVED

          THAT:   Subject to Worcestershire County Council giving approvals substantially in the same form as those contained in the recommendations of this report

(a)       Notes, pursuant to the Cabinet Report of 16 February 2012 relating to a variation to the existing waste contract to provide for an Energy from Waste plant at Hartlebury Trading Estate (the EfW Plant), the on-going discussions with Mercia Waste Management Limited (Mercia) in relation to their proposals and the current status of satisfaction of the Parameters identified in that report;

(b)          Cabinet authorised the Director for Places and Communities in consultation with the Cabinet Member for Major Contracts, the  Chief Officer Finance and Commercial and Worcestershire County Council and through the joint governance arrangements between the two authorities to pursue terms for alternative methods of finance for the EfW plant;

(c)              

                                                     (i)        authorised the Director for Places and Communities in consultation with the Cabinet Member for Major Contracts and Worcestershire County Council and through the joint governance arrangements between the two authorities, to consider how the commissioning and operation of the EfW Plant could be integrated into the existing arrangements with Mercia, and

                                                   (ii)        if the Director for Places and Communities considered there was no satisfactory resolution in respect of point (i) above then (subject to f) below) he is authorised if he considers it necessary (in consultation with the Cabinet Member for Major Contracts and Worcestershire County Council and through the joint governance arrangements between the two authorities)to launch a tendering exercise to commence the direct procurement by the 2 Councils of the EfW Plant in accordance with paragraph 9.9 below;

(d)             Notes that Worcestershire County Council is authorised to procure and commence enabling works up to a maximum capital cost of £1.8m at Hartlebury in order to maintain the programme for the EfW Plant;

(e)             Require the Director of Places and Communities to report back during the summer of  2013 with proposals for financing and procuring the EfW plant (by variation of the existing PFI contract or fresh procurement) to enable Cabinet to take a final decision; and

(f)              Notes that Worcestershire County Council is expected to approve similar recommendations and that c ii) is subject to satisfactory negotiation and agreement with Worcestershire County Council of necessary amendments to the current Joint Working Agreement in place between the Councils; and

(g)             Requires the Director for Places and Communities to report back to the Cabinet in the report referred to in (e) on the decisions taken by Worcestershire County Council on waste contract management and any implications for Herefordshire Council.