Controversial Derbyshire waste site is set to reopen after councils resolve dispute
Two Derbyshire councils have finally resolved to fix and run a controversial waste treatment facility which was at the centre of a multi-million pound payout by the authorities.
Derbyshire County and Derby City councils originally agreed to pay a huge multi-million pound out-of-court settlement to Resource Recovery Solutions’ waste management team’s administrators after the councils terminated a contract for the waste management team to manage the facility, on Sinfin Lane, at Sinfin, Derby.
But long-awaited plans to finally fix and operate the temporarily-closed Derby and Derbyshire waste treatment facility stalled when the county and city councils fell out after Derbyshire County Council issued an invoice to Derby City Council in January, 2024, for £93.9m plus VAT to recover its share of the new project costs which the city council disputed.
The councils have now announced they have successfully addressed the ‘key issues’ that led to this dispute between them which has now been resolved to pave the way to fix and operate the Sinfin New Waste Treatment Facility.
A spokesperson for both councils said: “We’re pleased to confirm that the dispute has been fully resolved and both councils have reaffirmed their commitment to working in partnership to get the waste treatment centre at Sinfin operational.
“This is in line with the decisions to fix and operate the facility which were taken by Cabinet members at both councils at their respective meetings in February, 2023.
“We look forward with confidence to moving the project forward to provide both councils with the most viable and cost-effective, long-term solution for the management of household waste, to benefit residents in both the city and county.”
Derby City Council had originally disputed the validity of the county council invoice and this triggered a ‘notice of dispute’ which included the county’s refusal to formally include regular reviews of project progress against the business case to fix and operate the facility.
Both councils failed to resolve this dispute and agree terms in May and they fell into the next stage of formal dispute processes before matters were resolved.
The councils have now stated they will move forward with the procurement exercise to rectify defects at the facility and bring it into use.
Terms of a new Inter Authority Agreement have been reached and agreed in full which means both councils can move forward in partnership to complete the project.
The councils stated they remain committed to the original decision, made in February 2023, to fix and operate the existing plant after soft market testing with positive engagement from the waste industry confirmed there was capability, capacity and appetite to deliver the project.
Derbyshire County Council previously confirmed the £93.9m plus VAT invoice was to recover the county council’s share of the costs of the waste site project and this was separate to both councils’ shared £93.5m settlement figure which was previously agreed to be paid to RRS’s administrators.
Originally, Derbyshire County Council and Derby City Council had awarded a contract in 2009 to RRS – which was a partnership between infrastructure firm Interserve and waste management company Renewi – to manage the councils’ residual waste, design, build, commission, and operation of the waste treatment facility in Sinfin, Derby.
However, the county council revealed in July 2023 that both councils had agreed to pay a share of a total £93.5m out-of-court settlement to RRS’s waste management team’s administrators to resolve a dispute after the local authorities had terminated a contract with the waste management team to manage the waste facility.
Derbyshire County Council stated RRS had originally paid for the facility which, under the county and city councils’ original contract with RRS, was to be designed, built and completed in 2017 to divert 190,000 tonnes of waste per year away from landfill.
But the county council added that after RRS failed to pass commissioning tests by an agreed date, the authorities lawfully terminated the contract in August, 2019, and the councils and RRS began a process to determine the Adjusted Estimated Fair Value compensation of the contract to be awarded to either RRS or the councils.
Both councils resolved in July 2023, to accept an out-of-court settlement arrangement and pay RRS £93.5m to protect council tax-payers from the risk of further significant costs after RRS’s administrators had originally claimed they were owed £187m, according to the county council.
The county council had stated this total settlement sum of £93.5m had been shared by the councils in accordance with an agreed split with £36.57m paid by the city council and £56.93m paid by the county council.
Both councils have been reluctant to discuss what effects the on-going temporary closure of the waste site has had for the councils, the county and Derby in terms of costs, lost income, expense and the need to fulfil environmental waste disposal commitments.
Campaigners and residents have also previously complained that the Sinfin waste site will pose a threat to air quality.