Destroying waste in a planned new £60 million incinerator in Shrewsbury may be more costly to Shropshire Council than sending it to landfill, a planning inquiry has heard.

Keith Kondakor, representing Friends of the Earth at a hearing into whether Veolia should be allowed to go ahead with the plant at Battlefield Enterprise Park, said the authority would be paying in the region of £10.8 million per year.

He said this cost to dispose of 90,000 tonnes of rubbish at the site would equate to a cost of £120 per tonne for disposal – more expensive than the current landfill tax of around £80 per tonne per year.

Mr Kondakor said: “Shropshire Council signed a contract to pay £10.8 million for 90,000 tonnes of capacity – that is £120 per tonne.”

He added: “If you have landfill of 90,000 tonnes, you would pay £80 per tonne, it is those sort of figures. For 90,000 tonnes, you are talking about £7 million or £8 million for landfill tax.”

The figure was revealed during cross-examination of Donald Macphail, managing director for Veolia Shropshire, who said that while the initial contract signed with the council was £10.8 million, the figure had now changed.

He said he would not be able to reveal it as it is ‘commercially sensitive’.

But he did agree it was a ‘ballpark similar figure’.

Mr Macphail said one of the reasons waste firms and local authorities were attempting to move away from using landfill sites was because the tax on the sites was continually increasing as the Government looks to make the UK more environmentally friendly.

“It is going to be £80 per tonne by 2015 and goodness knows what happens after that. Every local authority has a focus on that landfill tax,” he said.

Mr Macphail added that Veolia’s contract with Shropshire Council means that the company would not penalise the authority if there was not enough waste provided to it by the council, but would instead be responsible for making up any capacity gap itself.

He is the first of the waste firm’s expert witnesses to appear at the hearing, which is examining whether to overturn a decision by Shropshire Council’s planning committee to reject the proposed burner last year.

Veolia says the facility could generate enough power to supply 10,000 homes.