The decision by Defra to remove PFI credits from Bradford and Calderdale Councils may be forced to go to Judicial Review.
Both councils planned to build an energy from waste facility in Bradford to handle 193,000 tonnes of waste, but Defra withdrew £62.1 million of promised waste infrastructure credits that left the future of the facility uncertain.
As a result, the councils argue that if they had known Defra intended to withdraw the credits, around £2.7 million in costs could have been saved.
Calderdale Council leader Councillor Tim Swift said: “We feel that Defra’s decision has left us with no option but to apply for a Judicial Review.
“The investment in a new waste treatment plant should have led to major savings for council tax payers in both local authorities, yet instead we are now left with major costs.
“The impact of Defra’s decision is detrimental not only to the local economy of both Calderdale and Bradford, but also to the environment, leaving both councils with the major problem of how to get rid of our waste in the future.”