A new state-of-the-art anaerobic sludge digestion plant has been delivered in north-east England using NEC contracts. Built to replace an ageing sludge incinerator at the Knostrop Wastewater Treatment Works in Leeds, the new £65 million Energy and Recycling Facility has reduced greenhouse gas emissions and will save client Yorkshire Water £1.6 million a year in operating costs.
The work was let to 2015−2020 framework partner Black & Veatch in two stages. Outline design and site investigation started in April 2015, each under an NEC3 Engineering and Construction Contract (ECC) Option C (target contract with activity schedule), after which the main design and build contract was awarded in March 2016, following a mini competition and negotiated tender, using NEC3 ECC Option A (priced contract with activity schedule). Black & Veatch was both the principle designer and principle contractor.
Key supply chain partners, including civil engineering firm Clugston, tank manufacturer Balmoral Tanks and electrical controls specialist CEMA, were each engaged under an NEC3 Engineering and Construction Subcontract (ECS). NEC ECC project manager Turner & Townsend and technical consultants Arup, BIM-UK and Stantech were all employed using NEC3 Professional Services Contracts (PSC).
The project involved designing and building a mesophilic anaerobic digestion plant capable of processing 48,000t of dry solids a year. Imported sludge cake and thickened liquid and indigenous sludges are now pumped into four digesters which generate methane, which in turn is used both to heat the digesters and produce up to 94MWh electricity a day in two combined-heat-and-power generators, enough to meet 55% of the site’s power needs. The digested sludge is then dewatered and mixed with lime before being sold as agricultural fertilizer. The works were successfully completed on time and budget in October 2019.
Preferred contract suite
Yorkshire Water project manager Lee Laherty says, ‘NEC has been our preferred contract suite for construction-based procurement since 1995. We believe the standard contracts stimulate a good working relationship between the parties, have a straightforward structure, are easy to understand and can be used to suit a wide variety of commercial situations on different types of work.
He said the Knostrop Sludge Treatment Facility was Yorkshire Water’s largest project delivered in the 2015−2020 asset-management period, so it was important for it to be delivered to time, budget and quality. ‘Early site investigation work by our contract partner Black & Veatch under ECC Option C allowed us to mitigate and design out project risks from the outset. For example, disused mine workings and contaminated ground were avoided by revising the site layout, thereby removing risk from the project.’
Black & Veatch then negotiated a number of single-source, back-to-back NEC3 ECS subcontracts for civil engineering, tanks and electrical controls during its tender for the main NEC3 ECC contract. ‘Extending NEC collaborative working to these key supply chain partners ensured even greater control of costs and time,’ says Laherty. ‘For example, time over-runs associated with concrete tank remedial work were offset by an accelerated commissioning programme.’
He says the clear definition of scope and robust risk- and change-management process in both the NEC main contract and subcontracts ensured the contractually required ‘spirit of trust and mutual co-operation’ endured throughout the three-and-a-half-year works programme. ‘Risk-reduction meetings were held on a monthly basis to discuss NEC early warnings and compensation events, helping to ensure early generation of biogas power in December 2018 and overall completion on time and budget in October 2019.’
Benefits of using NEC
- NEC contracts stimulate a good working relationship between the parties, have a straightforward structure, are easy to understand and can be used to suit a wide variety of commercial situations on different types of work.
- NEC procedures for early warnings and risk-reduction meetings promote upfront communication between all parties to help resolve issues and avoid late surprises, such as programme delays, buildability, and environmental and financial issues – a win-win for all.
- Using NEC contracts throughout for procurement of services, works and key suppliers ensures a consistent and robust approach to risk- and change-management throughout the project team.
- NEC flexibility means ECC can be used for early contractor involvement and well as procurement of main construction works.
- ECC Option A payment mechanism and risk allocation gives clients a strong control over project costs when the scope is well defined.