Government confusion delays signing of EfW contract

Government sources have indicated that a lack of communication between the Cabinet Office and the Treasury has delayed the signing of a contract between the government and an energy-from-waste (EfW) plant.

A power purchase agreement (PPA) between the Cabinet Office and Air Products was supposed to be signed at the end of May.

However, any contract that spans a general election, which this one would, has to appear in parliamentary minutes for at least 14 days before it starts to give MPs a chance to object. The Treasury informed the Cabinet Office of this fact with only days to go.

According to sources, Cabinet officials were “frustrated” at the cause of the delay because it could have been avoided if their Treasury colleagues had told them about the parliamentary procedure months earlier, rather than “waiting to the last minute”.

Despite the delay, Air Products and the Cabinet Office expect the PPA for the 49MW Tees Valley Renewable Energy Facility to be signed by the “end of June/early July 2013”.

It is expected that once the deal is signed, it will help to deliver £84 million of savings to the government over the 20-year duration of the contract.

A Cabinet Office spokesman said: “Cabinet Office and HM Treasury are currently following standard processes to ensure all necessary checks before the contract is finalised.”