Agenda item

To seek approval of a short term interim arrangement for residual waste disposal, covering the period between expiry of the said contract on 6 August 2018 and the date on which the provision of services under the Gloucestershire Residual Waste Project at the Javelin Park Energy from Waste facility shall commence. 

Cllr Nigel Moor, Cabinet Member for Fire, Planning and Infrastructure, sought approval of a short term interim arrangement for residual waste disposal in Gloucestershire, covering the period between expiry of the said contract on 6 August 2018, and the date on which the provision of services under the Gloucestershire Residual Waste Project at the Javelin Park Energy from Waste facility commence. 

Having considered all of the information, including known proposals and the reasons for the recommendations, Cabinet noted the report and, 

RESOLVED to:

1)    Extend the term of its current Waste Management Services Contract with Cory by 1 year and 6 months, (with the effect that it will expire on 10th January 2020), by entering into a variation agreement with Cory for this purpose; and

2)    Delegate the completion and execution of the proposed variation agreement to the Commissioning Director, Communities and Infrastructure.

Cllr Nigel Moor, Cabinet Member for Fire, Planning and Infrastructure, sought approval of a short-term, interim arrangement for the disposal of residual waste in Gloucestershire, (covering the period between the date of expiry of the said contract on 6 August 2018, and the date on which the provision of services under the Gloucestershire Residual Waste Project at the Javelin Park ‘Energy from Waste Facility’ were due to commence). 

Outlining the background to the decision, Cllr Moor informed members that the contract for residual waste disposal had been awarded to Cory Environmental (Gloucestershire) Ltd in 2006. Extended in 2012, the contract was due to expire in August 2018, at which time it had been expected that the new energy from waste facility at Javelin Park would be fully operational, with no further landfill disposal required.

Due to unforeseen delays in the delivery programme of the Energy from Waste Facility, a gap had emerged in the contracted provision of residual waste disposal between expiry of the Cory landfill contract in August 2018, and the ‘go live’ date of the waste facility in July 2019.

With waste disposal a vital core statutory requirement, the council have since reviewed the options to bridge this gap. The options include: -

:

a)    To go to market to procure a new, short term waste disposal contract to start in August 2018;

b)    To negotiate with Cory to vary the expiry date of the current contract;

c)    To disaggregate the elements of the current contract; seek to extend just the landfill element, and procure new contracts for the other elements (garden waste, composting, mixed waste, landfill monitoring).

Cllr Moor referred to the outcomes of a recent options appraisal, setting out the financial implications and associated risks of each course of action and available options.

Proposing option b) as the preferred option; ‘to vary the current contract, and remove the significant risks around service provision and cost increases’, Cllr Moor clarified that, to approve this proposal would extend the contract for up to 18 months, extending to when Javelin Park was expected to be fully operational, (July 2019), and allowing for a reasonable contingency period of up to six months, extending into 2020.

The anticipated value of the proposed contract extension, (included in the existing waste disposal budget), were reported at a value of between £16 million, (if the contract expired in July 2019), up to a maximum of £24 million, (should the contract run until January 2020). Members noted that a large proportion of the value of the contract related to landfill tax, the sum of which would be passed to the Department of Revenue and Customs by the contractor.

Responding to questions about the future of the landfill site at Hempsted, (raised earlier in the meeting), Cllr Moor confirmed that Cory was currently working to extend the life of the landfill site to accommodate the proposed extension of the residual waste contract. The site will remain open during this period. On closure of the landfill site, (for new landfill), in either late 2019 or early 2020, Cory would continue to manage the site.

Having considered all of the information, including known proposals and the reasons for the recommendations, Cabinet noted the report and, 

RESOLVED to:

1)    Extend the term of its current Waste Management Services Contract with Cory by 1 year and 6 months, (with the effect that it will expire on 10th January 2020), by entering into a variation agreement with Cory for this purpose; and

2)    Delegate the completion and execution of the proposed variation agreement to the Commissioning Director, Communities and Infrastructure.