Planning permission for Hertfordshire County Council and Veolia's 26 MW waste-to-energy and material recycling PFI project in Hatfield, UK, has been rejected.

The Secretary of State Eric Pickles has rejected the project three years after it reached financial close alleging the plant would impact on Hatfield's Green Belt. The minister also said the that the plant could 'absorb' a large proportion of the waste generated in the area, preventing other treatment capacity from being developed in the area.

The county council is responsible for disposing of the 540,000 tonnes/year of waste that Hertfordshire's residents produce and it does not have a long-term waste treatment solution.

Commenting following the ruling Terry Douris, Hertfordshire council's cabinet member for waste management, said:

"This is very disappointing news. We urgently need an efficient and cost-effective way of dealing with Hertfordshire's residual waste that will help us divert the maximum possible amount of waste away from landfill. Building this recycling and energy recovery facility would save Hertfordshire residents an estimated £667m over 25 years. Doing nothing simply isn't an option.

Veolia signed the 25 years contract to to build the facility with Hertfordshire County Council in July 2011. The project investment was estimated at £800 million. Defra had committed £115.3 million in PFI credits to help fund the development.

Veolia has argued that although the planned location for the plant is on a Green Belt site, this should not act as a barrier as some of the land has already been developed on. Robert Hunt, Veolia UK's Chief Corporate Officer, stated:

In our view there remains a clear local need for regional waste treatment infrastructure of this nature in Hertfordshire. This decision and the length of the decision-making process also send out a very negative signal to inward investors in UK Plc.