Viridor making EfW progress in transition period

Waste service provider Viridor is performing in line with management expectations in 2013/14 according to an interim statement released by its parent company Pennon Group today (February 14).

This is despite adverse weather and difficult trading conditions creating challenges for the firm, which is headquartered in Taunton, Devon.

In November, Pennon Group which also owns South West Water reported that Viridor had witnessed a fall in 28.8% profits down to 15.3 million in the first half of the financial year. This was partly caused by a 5.5 million fall in revenues from recycling (see letsrecycle.com story).

But today, Pennon says it is making good progress in growing its portfolio of energy from waste (EfW) facilities in what it describes as a transitional period for the waste firm. According to Pennon, EfW plants currently under development will transform Viridor into a leading player in the UK renewable energy sector.

Among the plants currently under development are Viridors Runcorn I and Exeter facilities, both of which are in commissioning and are expected to begin burning waste by the end of March.

Infrastructure

Meanwhile, its 205 million EfW plant at Ardley in Oxfordshire, built as part of a 25-year residual waste treatment contract with Oxfordshire county council signed in March 2011 (see letsrecycle.com) commenced commissioning this month.

Pennon Group also anticipates that it will be given the notice to proceed on the Beddington Energy Recovery Facility (BERF) shortly. The 275,000 tonne capacity facility, which forms a part of Viridors 990 million contract with the South London Waste Partnership, was awarded planning consent in May 2013, although campaigners have been considering whether the challenge the decision (see letsrecycle.com story).

Elsewhere, excellent early progress has been made on its 154 million waste treatment facility in Glasgow, work on which began in November (see letsrecycle.com story), and Peterborough, which is being built under a 30-year waste treatment contract with Peterborough city council.

In the statement, Pennon said: The company has made excellent progress in establishing its energy from waste business which will transform Viridor into a leading player in the UK renewable energy sector. Not withstanding the adverse weather and difficult trading conditions, Viridor is successfully holding operational performance broadly in line with management expectations and operating contribution is slightly ahead of last year.

PBIT (profit before interest and tax) plus joint ventures is still expected to be broadly similar to last year but has been impacted by increased pension costs as a result of auto-enrolment and by the outage previously flagged at Lakeside.