Friday, 2 September 2016

Financial shambles compounded by flawed technology


The external auditors who gave Scottish Borders Council a 'clean bill of health' in the wake of the waste management contract omnishambles despite the loss of at least £2.4 million of public money, concluded the award of the £80 million deal to New Earth Solutions Group (NES) was not reliant on delivery of the 'advanced' form of technology earmarked for the project..

According to accountancy specialists KPMG, the firm engaged by Audit Scotland to inspect SBC's books: "Appropriate options were considered and due diligence processes are evidenced as being followed." They even went on to add: "The technology which has subsequently not been able to be implemented was not core to the original agreement with NES".

Of course, none of that evidence from KPMG's work has been made public. The auditors even mention the decision taken by councillors in October 2012 to sanction a major variation of the contract to include the incineration element with its completely unproven NEAT pyrolysis.

It seems fairly obvious the proposed £21 million treatment facility at Easter Langlee on the outskirts of Galashiels foundered in chaos because the NEAT system to turn rubbish into electricity simply would not work. The joint press release issued by council and contractor announcing the death of their four year partnership said exactly that, citing technological issues alongside financial difficulties.

Perhaps KPMG, Audit Scotland, and even those involved directly in the unmitigated failure would like to study material recently released by the Scottish Environment Protection Agency [SEPA] under Freedom of Information (FOI) which has uncovered a range of unresolved issues still dogging the NEAT system TWO YEARS after SBC's elected representatives signed up for it.

The results of investigations published in these columns over the last 18 months have been largely about the squandering of public money on a project which the now defunct NES Group and its bankrupt offshore funders New Earth Renewables & Recycling [Infrastructure] PLC were incapable of developing.

But there are some equally disturbing unanswered questions regarding the technology which Borders councillors were convinced would make SBC the leading waste disposal authority in Scotland.

The inclusion of the thermal system necessitated an application to SEPA in 2013 for a major change to the Easter Langlee plant's Pollution Prevention and Control [PPC] permit before the facility could even be switched on.

But as we recently reported, other FOI requests revealed how after months of delay the NES Group suggested SBC together with Scottish Government agencies should bring pressure on SEPA to forget about the flaws in the NEAT system and grant the permit.

Around this time the Galashiels technical systems being tested by NES at their sister plants in Canford and Avonmouth were frequently misfiring. On occasions the machinery had to be shut down to avoid serious damage while mention is also made of equipment breakages and the need for adjustments by skilled engineers. That remained the position in October 2013.

A FOI request to SEPA asked whether the independent agency had been aware of the attempts by NES to pressurise them into approving the PPC for the Borders. SEPA denied any knowledge of this, but also released several files containing correspondence linked to the permit application.

One detailed email exchange between SEPA's experts and NES is dated October 8th 2014 - the week in which a 16-strong delegation from SBC travelled to Avonmouth on what was supposed to be a due diligence visit.

It should be borne in mind that the SEPA missive was written fully two years after the local authority voted to include NEAT syngas and pyrolysis at Easter Langlee.

Full details including technical analysis, from the message will be published here in the next few days. But perhaps this extract gives readers an idea of how far the applicants were of obtaining their much coveted permit:

"We [SEPA] are of the opinion that the information provided to date does not provide adequate demonstration that either the gases have been purified so they are no longer a waste prior to their incineration, or that they can cause emissions no higher than those resulting from burning natural gas. This means that at the present time we are unable to progress the determination of the Renewable Energy Facility part of the application for substantial variation based on the current design".

Presumably KPMG, Audit Scotland and members of SBC had all seen this negative critique before concluding "the technology (which has subsequently not been able to be implemented) was not core to the central agreement with NES". It is a conclusion which simply will not wash with many local council taxpayers.


No comments:

Post a Comment