Waste-to-energy plant tender collapses as all bids disqualified
One bidder dropped out months ago, another was turned down when it tried to change its offer
A delayed tender for a planned waste-to-energy plant in Magħtab was scrapped altogether on Friday, with Wasteserv announcing that procurement for the plant “closed without a successful award”.
Despite the setback, the company said it “remains determined to deliver” the project.
The waste-to-energy project, first announced in 2017, promises to convert landfill waste to energy and is seen as a cornerstone of Malta’s efforts to reach its green energy targets. The plant is believed to potentially generate enough energy to power some 25,000 households for a year.
The construction and management of the plant was awarded to a consortium composed of the French company Paprec and local contractors Bonnici Bros in 2023, with a €600 million price tag, the lowest of the three bids received.
However, the process hit a snag shortly afterwards, when fellow bidders Hitachi appealed, arguing that the selection process was tainted.
Although Hitachi’s complaint was initially thrown out by the Public Contracts Review Board, Maltese courts reversed the decision, sending the evaluation process back to the drawing board.
A second evaluation board reached an identical conclusion, once again awarding the contract to the Paprec consortium, but Hitachi once again filed an appeal calling for the process to be struck down.
The process has now been scrapped altogether, with Wasteserv saying “no remaining bids met the necessary requirements for evaluation”.
Consortium insisted on revising contract conditions
The news comes after the winning Paprec/Bonnici Brothers consortium dropped out of the process in May, failing to renew their bid as required by public procurement laws. The reasons behind the consortium’s decision are not known.
The tender then fell to runners-up Hitachi (who have since rebranded as Kanadevia), who had initially submitted a €781 million bid.
However, new issues emerged in late September, when Wasteserv asked the Hitachi consortium to confirm its intention to renew its bid.
In correspondence seen by Times of Malta, the consortium first raised seemingly minor administrative objections, arguing that the request to renew the bid should be addressed to the consortium’s new name, Kanadevia, not the Hitachi name used when submitting the bid.
In reply, Wasteserv, pointed to how all correspondence with the consortium had always used “the exact same nomenclature and references,” seemingly without any issue.
Days later, the consortium confirmed its intention to renew its bid’s validity but, crucially, only “on the condition that potential value engineering measures will be agreed with a view to optimising the project scope and parameters”.
These included changes to the plant’s proposed canopy features and water-cooling system, Hitachi said, requesting a meeting with Wasteserv “to explore these matters further”.
However, Wasteserv said in its reply, “bid validity extension requests cannot contain any deviations or conditions”, adding that the bid would be disqualified if Hitachi failed to stick to its original offer.
The matter came to a head on Friday morning, with Wasteserv formally informing the Hitachi consortium that its offer “will no longer be considered for award as no valid extension of validity has been received within the required timeframe”, citing procurement laws that forbid negotiations after a bid has been submitted.
Friday’s development sends the matter back to the drawing board, almost a decade after plans for the project were first announced, with Wasteserv set to restart the evaluation process from scratch.