Council Project Hit By Increased
Construction Costs
Escalating construction costs have
impacted on the budget for two digesters at the Christchurch
Waste Water Treatment Plant.
Council today approved
additional capital funding of $8.59 million for the
project.
Three tender prices were received for the
project, the lowest of which was $15.52 million, giving an
overall project cost of $18.59 million. The capital cost for
this project was originally estimated at $6.2 million in
2002 and this was re-evaluated at $10 million in December
2004, in conjunction with several other projects.
General
Manager City Environment Jane Parfitt says the increase
reflects the ongoing difficulties that the Council is
experiencing in reconciling budgeted costs with the current
soaring costs in the construction industry.
"The
construction industry worldwide is booming and demand has
seen prices escalate for materials such as cement and
steel," Mrs Parfitt says.
"We are not alone in this
situation as throughout New Zealand capital project costs,
in both local Government and private enterprise, are
exceeding budget estimates."
The additional digester
capacity is required to meet the increasing demand at the
plant. The digesters have been sized to meet predicted loads
and flows through to 2026. The current digesters are
periodically overloaded and this can cause process and odour
problems. The additional digester capacity will increase
biogas production which will allow for some additional
generation of electricity on the site.
"The additional
capacity could not be delayed without significant risk of
partial process failure at the treatment plant," Mrs Parfitt
says.
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