Coventry Telegraph

Extra cash needed for major reclycling centre in Coventry

- By CLAIRE HARRISON

EXTRA cash is needed for a major recycling facility in Coventry which will take waste from Nuneaton and Bedworth.

The Material Recycling Facility (MRF) is a project between eight local councils including Coventry City Council and Nuneaton and Bedworth Borough Council.

It is no secret that the project has run massively over budget. It was originally estimated to cost £34.5m and then it was revealed that this rose by more than £20m.

Nuneaton and Bedworth Borough Council has already put just over £4m into the project. It will see all of the borough’s recycling taken to the new facility in Coventry.

But now the Town Hall is being asked to contribute more, according to a cabinet report. It says the overall capital budget requiremen­t to complete the project has increased by 4.9 per cent.

To help cover this increase, the local authority is being asked for a further loan of £233,784 towards the scheme.

“Constructi­on of the MRF has been under way since May 2021 and is due to be complete and fully operationa­l by the end of summer 2023,” the cabinet report states.

“Civils works are due to be largely complete on site by the end of November 2022, with a secondary period scheduled for Spring / early Summer 2023 to include a comprehens­ive fire protection system.

“The installati­on of process equipment (mechanical and electrical) has now commenced and will conclude ahead of the civil works re-commencing on site. Following the completion of the procuremen­t exercise, the initial capital budget for the project was set at £62.2M.

“This budget is made up of several elements: constructi­on costs, process equipment costs, the budget to establish

SRL (including the various profession­al fees to oversee the constructi­on phase of the project), and an amount of capitalise­d interest.

“While the majority of the project costs were fixed at the award stage, there were some costs which were unknown at the time of contract award and which were allocated a sum in the risk register. The costs of establishi­ng SRL and the profession­al fees required through the constructi­on phase and into the operationa­l phase were estimated as part of the business planning process and the developmen­t of the financial model.

“Each partner council committed to meet the capital funding requiremen­ts of the project in proportion to the amount of recyclable waste which they anticipate­d sending to the facility for processing. The annual tonnage was based on previous recycling performanc­e and was captured in the Waste Supply Agreement signed by each partner council.”

It concludes: “While there have been some improvemen­ts to the overall budget position through lower insurance costs, lower costs associated with the installati­on of the private wire connection, and an initially favourable exchange rate for the process equipment purchased in Canadian dollars there have also been several areas where costs have risen, including additional constructi­on costs, delay damages, foreign exchange rates, utility costs, profession­al and legal fees, staffing costs, higher ICT costs and significan­tly higher insurance premiums. Between them, the increase in annual insurance premiums and the fall in the values of the pound alone make up 70 per cent of the additional cost pressures on the project.”

Cabinet members will meet on Wednesday, November 9 to decide whether to rubber-stamp the extra spend. The meeting will be held in the council chamber from 6pm.

 ?? ??

Newspapers in English

Newspapers from United Kingdom