Of the 28 PFIs established in the waste sector since 1997, 24 are still on-going, with 8 due to end in the next seven years. Around half of waste PFI contracts granted have included conventional energy from waste (EfW) as a key element, and these projects have been largely successful. They also represent opportunities for the Authorities to make windfall profits from the sale of electricity and energy. UK Electricity Spot Prices have risen from around £50 MWh in 2020/21 to around £400 MWh today, with longer term Contract Forward Prices following a similar trend.

To realise this opportunity, the Authorities will need to plan for contracts for the long term operation and maintenance of their EfW facilities, and the possible refurbishment and expansion of their facilities.

However, “all that glitters is not gold”. Those Authorities with EfW facilities could have significant capital costs for Carbon Capture, Usage and Storage or pay on-going revenue for carbon emissions towards the end of the 2020s.

Local Authorities need to consider a strategic approach to their returning PFI assets.

For further discussion – read “The end is nigh for PFI – CIWM Circular September October 2022”