Renewi seeks to cancel recycling contract

United Kingdom-based waste and recycling firm Renewi PLC is in discussions with Scotland’s Dumfries and Galloway Council and other stakeholders to initiate a termination of what the firm calls a “money-losing private finance initiative (PFI) operating contract.”

In calling for the cancellation of its contract, Renewi says the project is unable to address the needs of Zero Waste Scotland (ZWS) legislation that sets what the company considers to be “demanding new requirements regarding landfill diversion and recycling [starting in] 2021.”

Renewi has been working with the council and other stakeholders for several years to determine how the 15-year-old PFI waste project and the related operating contract could be amended to meet the requirements of ZWS. However, despite these discussions, a workable solution compliant with ZWS has not been found to Renewi’s satisfaction.

The termination will be designed to enable D&G Council and other stakeholders to explore new ways to comply with ZWS’ obligations, according to Renewi. The proposed termination of the operating contract is expected to become effective in the upcoming financial year.

Renewi indicates the remainder of its municipal division is unaffected by the termination.

“Regrettably, the D&G PFI project and Renewi’s operating contract do not currently meet the objectives of the new Zero Waste Scotland legislation,” says James Priestley, managing director of Renewi’s municipal division. “Terminating the operating contract is not a decision we have taken lightly, and we will work with D&G Council, our employees and our other stakeholders to ensure a seamless transition. Whilst our termination discussions are taking place, we will continue to ensure a high quality and efficient service to the Council and the residents of Dumfries and Galloway. This decisive action is in line with our strategy to actively manage our portfolio of U.K. assets to reduce future risk.”