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Taxpayers face €350m incinerator bill

TAXPAYERS may be forced to shoulder financial penalties of up to €350m for the Poolbeg incinerator, according to a new report.

Dublin's four local authorities could be exposed to penalties ranging from €187.4m to €350.7m over 25 years, it was claimed.

Senior counsel John Hennessy, who was commissioned by former environment minister John Gormley to write the report, concluded the councils' contractual obligation of delivering a specified amount of waste to the incinerator each year could prove very costly.

The so-called 'put-or-pay' clause with US company Covanta could cost as much as €14m a year over 25 years in a "worst case scenario".

Mr Hennessy said this situation would arise if the volume of waste going to the incinerator fell by 1pc a year and recycling rates increased by 3pc, while Dublin local authorities' share of the waste market fell by 3pc per annum.

His findings were revealed in a letter from Mr Gormley to the current environment minister, Eamon O Cuiv. Mr Gormley, in whose Dublin South East constituency the incinerator is to be located, called on Mr O Cuiv to publish the conclusions and includes extracts from the document.

The TD said Mr Hennessy also found the costs of abandoning or varying the project were much lower than claimed by Dublin City Council.


Mr Hennessy said the contract with Covanta allowed for "significant penalties" if the put-or-pay terms were not met.

Mr Gormley wrote that he could not in "good conscience" allow the debate about the plant to continue without these "key facts" being known.

The report was sent to the Taoiseach, the Minister for Finance and the Attorney General last September but no reply was received from the Taoiseach or Minister for Finance.

Mr Hennessy's findings show that waste volumes would have to increase at "Celtic Tiger rates" for financial penalties to be avoided, Mr Gormley said.

He insisted the city council would not be able to meet the charges.