Dublin City Council has disputed claims that it could terminate the contract for the proposed Poolbeg incinerator in Ringsend without having to pay millions of euro in compensation.
The council was responding to a report on RTÉ's Prime Time suggesting a "get out" clause meant the council could walk away from the contract with Covanta, signed in 2007, on Sunday if certain conditions are not met.
In a statement today, the council said it remained in a contractual position for the provision of a waste to energy facility at Poolbeg to deal with Dublin's residual waste.
The Prime Time report which claimed the council could walk away from the contract with no cost was "factually incorrect", it said.
The four Dublin local authorities have spent substantial sums to date in land acquisition, statutory processes and client representative costs," it said.
“This does not take into account any compensation that might be payable to the Public Private Partnership (PPP) company should the contract be terminated. The PPP company will also have incurred substantial costs,” the council said.
But the Irish Waste Management Association (IWMA), representing private waste collectors, claimed today that taxpayers are facing a €2 billion bill over 25 years if Dublin City Council does not get out of the contract.
The organisation also claimed the proposed 600,000 tonne incinerator would contribute to job losses as recycling processes generated ten times more employment. It would drive out competition in the market, drive down recycling rates and lead to higher waste costs, it said.
The association accused Dublin City Council of “scaremongering” the public and politicians into believing the incinerator contract with Covanta must be honoured or the State would face huge compensation bills.
Referring to the Prime Time report, the group said this "startling revelation" was in stark conflict with "repeated threats" from the Council of multi-million euro compensation bills if the project were halted, spokesman Brendan Keane said at a press conference in Dublin.
“The actions of the local authority look like another desperate attempt to ensure the incinerator goes ahead, despite being completely oversized.”
The council had several “very serious questions” to answer about how it had communicated with the public and politicians about the project and should release the entire contract for public scrutiny, Mr Keane said. It now appeared the council always had the ability to walk away from the project, he added.
The association claims a 600,000 tonne incinerator is far too large for the Dublin region waste market. If the project proceeds, it will cost taxpayers €2 billion over 25 years because the council has contracted to supply a high level of waste it does not have and faces paying large penalties, Mr Keane said.
The project has cost €120 million to date, and the proposed incinerator would lose between €10 million to €20 million each year, he said.
The four Dublin authorities were already losing €60 million a year on commercial waste services and, as residual waste volumes continued to fall nationally and in Dublin, the raw materials to run such an incinerator were no longer available, he said.
The association says independent research commissioned by it had shown a 300,000 tonne incinerator was more appropriate for the Dublin market. It also believes all waste collection services should be privatised.