Private Finance Initiative

Overview of PFI

A private finance initiative (PFI) is a way of financing public sector projects through the private sector. PFIs alleviate the government and taxpayers of the immediate burden of coming up with the capital for these projects. Under a private finance initiative, the private company handles the up-front costs instead of the government. The project is then leased to the public and the government authority makes annual payments to the private company. These contracts are typically given to construction firms and can last as long as 30 years or more.

In its desire to stimulate investment in waste infrastructure and underpin the diversion of BMW waste from Landfill, the Government supported/subsidized a range of treatment technologies on a number of sites that were procured by Waste Disposal Authorities needing this infrastructure through a dedicated long term Private Finance Initiative (PFI). This arrangement has now ceased and several schemes which had their funding agreed later had it removed after DEFRA assessed that the BMW targets could be met with the infrastructure funded to date.

Fast forward circa two decades later and some of these PFI projects are currently being considered by Waste Disposal Authorities for movement out of the PFI arrangement after consideration of the cost benefit of continuing with the contract. Indeed several have now removed themselves form the PFI model (i.e. Lancashire) or have had closed with major restructure (i.e. Sheffield and Greater Manchester).

PFI Projects in England

The table below is an extract from DEFRA data summarizing the residual waste projects that are/were PFI projects within England. Additional commentary/notes have also been added (an alternative PPP process and associated projects are listed on the PPP page):

Location	Project/Site	Classification	Status	Capacity (ktpa)	Plant Type	Comment
Bolton	Raikes Lane	PFI	Operational	86	EfW	Viridor Laing consortium GMCA contract terminated 2017, now Suez from June 2019 for 7 years
Cambridgeshire	Waterbeach	PFI	Operational	200	MBT	Amey Cespa site with variable performance reported, planning being pursued for new EfW on the site
Cornwall	St. Dennis	PFI	Operational	240	EfW	Suez site (Cornwall Energy Recovery) part of an integrated contract with Cornwall to 2039
ELWA 1	Frog Island	PFI	Operational	180	MBT	Renewi site servicing ELWA, recently reported financial difficulty
ELWA 2	Jenkins Lane	PFI	Operational	180	MBT	Renewi site servicing ELWA, recently reported financial difficulty
East Sussex	Newhaven	PFI	Operational	234	EfW	Servicing East Sussex County Council and Brighton and Hove City Council
Essex	Courtauld Road	PFI	Operational	417	MBT	Developed and operated by partners Urbaser Balfour Beatty servicing Essex County Council and Southend, reported operational difficulties
Greater Manchester	Longley Lane	PFI	Operational	110	MBT	Viridor Laing consortium PFI contract with GMCA terminated 2017, now Suez from June 2019 for 7 years
Greater Manchester	Runcorn Phase 1	PFI	Operational	325	EfW	Viridor bought out Laing in Nov 2018 and continues to operate under contract with GMCA to 2035
Greater Manchester	N. Manchester	PFI	Operational	65	MBT	Viridor Laing consortium PFI contract with GMCA terminated 2017, now Suez from June 2019 for 7 years
Greater Manchester	Oldham	PFI	Operational	99	MBT	Viridor Laing consortium PFI contract with GMCA terminated 2017, now Suez from June 2019 for 7 years
Greater Manchester	Salford	PFI	Operational	73	MBT	Viridor Laing consortium PFI contract with GMCA terminated 2017, now Suez from June 2019 for 7 years
Greater Manchester	Stockport	PFI	Operational	92	MBT	Viridor Laing consortium PFI contract with GMCA terminated 2017, now Suez from June 2019 for 7 years
Kirklees	Vine Street	PFI	Operational	127	EfW	Suez operated site primarily for Kirklees
Leeds	Cross Green	PFI	Operational	165	EfW	Site developed by Veolia on behalf of Leeds City Council under a 25 year contract to 2037
Leicstershire	Mowmacre Hill	PFI	Operational	120	MBT	Integrated contract delivered by Biffa for Leicester City Council for 25 years from 2002
L.B. Southwark	Old Kent Road	PFI	Operational	100	MBT	Suez integrated facility servicing Southwark
Shropshire	Battlefield Enterprise Park	PFI	Operational	90	EfW	Site developed by Veolia as part of a 25 year contract with Shropshire
South Tyne & Wear	Teeside Lines 4&5	PFI	Operational	256	EfW	Suez facility serving Stockton, Middlesbrough, Redcar & Cleveland and Northumberland and the South Tyne & Wear Partnership
South Devon	Devonport	PFI	Operational	245	EfW	MVV Umwelt facility serving South West Devon Waste Partnership under a 25 year contract
South Yorkshire	Bolton Road, Manvers	PFI	Operational	286	MBT	Renewi partnership with SSE delivering integrated MBT and AD facility to Barnsley, Doncaster and Rotherham Waste Partnership to 2040
Staffordshire	Four Ashes	PFI	Operational	325	EfW	Veolia operated site for Staffordshire County Council, 25 year contract from July 2010, with inputs also from Sandwell, Warkwickshire and Walsall
Suffolk	Great Blakenham	PFI	Operational	269	EfW	Suez facility delivered primarily for Suffolk under 25 year contract, with later deal for cross-border tonnage from Norfolk
Surrey	Charlton Lane Eco Park	PFI	In Construction	60	EfW	Suez integrated AD and Gasification facility for Surrey has had delays in commissioning the latter, now forecast Q1 2020
Wakefield	South Kirby	PFI	Operational	146	MBT	Renewi integrated contract for Wakefield City Council

PFI Projects in Scotland

The following table lists the PFI projects that are or were in place in Scotland dealing with the countries Residual Waste.

Location	Project Site	Classification	Status	Capacity (ktpa)	Plant Type	Comment
Dumfries	Eco Deco Plant	PFI	Terminated	65	MBT	Contract ended in Sept 2018. Asset transferred to Dumfries and Galloway Council
Dundee	Baldovie EfW CHP Facility	PFI	In Construction	110	EfW	MVV Site for Dundee City Council and Angus Council. Contract covers the operation of the existing EfW facility next door and the build of this newer facility.

PFI Projects in Wales

There is currently only one Residual Waste PFI in Wales and that is in Wrexham; the detials of which are shown in the Table below.

Location	Project/Site	Classification	Status	Capacity (ktpa)	Plant Type	Comment
Wrexham	Wrexham Eco Recycling Park	PFI	Operational	75	MBT	Produces RDF which is sent to Ferrybridge Multifuel 1 (FM1). Contract with Wrexham County Borough Council.