Wellington councillors want review of Moa Point sludge project after cost blowout

RNZ News

3 days ago

Artist impression of the new sludge minimisation facility at Moa Point which McConnell Dowell Constructors Ltd and HEB Construction Ltd will build.
Photo:
Supplied / Wellington City Council
Some Wellington city councillors are demanding an immediate independent review into how the city's sludge minimisation plant
blew out by $80 million
, with one saying it is "incredibly frustating".
But another is not surprised by the cost increases, claiming calls for a review now are "pure politics".
Councillors were told in a briefing on Thursday the sludge minimisation facility under construction at Moa Point was now
forecast to cost between $478-511m
.
Originally expected to cost $200m in 2021, $400m was set aside for the plant in 2022, with ratepayers levied to fund it.
Councillor Diane Calvert - one of the city's mayoral candidates - said she wanted to understand why the council was only becoming aware in the last few months of the "huge increase".
"It's half a billion dollars, the public rightly want answers."
Calvert said she asked for a full, external review of the
Wellington Town Hall cost blow-out in 2023
- which surged from $80m to over $330m - but that was voted down at the time.
"Now we are back in this position again, and I would like to see a review done now, not waiting until the project is completed at the end of 2026.
"Because we are intending to spend money on other projects."
The facility was designed to reduce the volume of sewage sludge created through the wastewater treatment process and turn it into a reusable, dry product.
It was designed to reduce the city's amount of sludge by 80 percent, and sludge-related carbon emissions by 60 percent. Piping sludge to the city's Southern Landfill will no longer be allowed in 2026.
Councillor and mayoral candidate Diane Calvert is calling for an external review of the project, but some say it's just "pure politics".
Photo:
RNZ / Dom Thomas
Council documents described it as a "complex project" with highly regulated construction of a "combination of mechanical, biological and chemical processes on a physically constrained site".
Chief infrastructure officer Jenny Chetwynd said the complexity of the project, delays and changes in the design, the risk the council had taken and the costs of the commissioning process were some of the reasons for the blowout.
The budget for commissioning - money used to test out the plant's functions and tweak the machinery before it opened, including bringing in international experts to do so - had grown from $2.5m to $20m alone.
Councillor Ben McNulty said he was "incredibly and deeply frustrated" by the cost blow-out.
"No one wanted this news, and I extend that to our officials didn't want this news, but it's happened, there have been signposts along the way, like the town hall review that may have equipped us to deal with some aspects, that we didn't take up, and now we are going to have put this forward.
"There is going to be an opportunity cost, because this $80 million means there's something else that we don't do."
McNulty agreed with an immediate independent review of the project.
"It's not a witch-hunt, it's about actually making sure we know exactly what went wrong, we lead it with really qualified people external to the project, so they come in with fresh ideas and perspective and we learn this and so we don't do this again."
But councillor Tim Brown said he was not really surprised the plant escalated in costs, because it was a project which involved a high degree of risk.
"It's disappointing but not a surprise at all."
He said a review should be conducted after the facility was completed, but not immediately.
Brown said management had been upfront throughout the process about the complexity and challenges of the project. He said the council had chosen to take on the risk of the project from the outset.
He said the blow-out of the sludge minimisation facility, was not on the same scale as the Wellington Town Hall, which he said was "genuine mismanagement" and involved an entire re-think of the project.
He said calls for an external review now were politics in an election campaign.
"What [Diane Calvert] is asking for now is pure politics.
"The value created by doing a review at this point, is negligible. You are not going to change anything at this point going forward.
"At the end of it all, once it's all done and dusted [is] a good point to say could we, and should we have done something differently."
The council will meet next week to vote on additional funding for the project.
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