The country’s biggest waste incineration plant AEB may go bust if Amsterdam city council continues to block a partial privatisation plan, the AEB management has warned. The incinerator is 100% owned by the city.

The Financieele Dagblad has seen a letter from the AEB board to the city officials which appears to be a last ditch attempt to push through a deal with commercial recycling company Beelen in Alkmaar.

AEB faces a €74m loss after banks withdrew their support. Beelen is said to be ready to make a €67m capital investment immediately.

The plan to make Beelen a majority shareholder in the publicly owned company had been concocted behind closed doors during the summer months, the FD revealed earlier. However, the council’s  left-wing majority prefers AEB to be partnered with waste processor HVC  which is also in public hands.

The AEB argues in the letter that HVC wants to scale down its incineration activities which would jeopardise heating for 35,000 households. Its financial structure is also complicated possibly making Amsterdam liable for more costs, the paper said.

The council’s refusal resulted in last week’s departure of D66 alderman Udo Kock who considers partial privatisation to be the best option financially. Selling a stake, in return for a capital injection to carry out essential work on the plant, would limit the cost to the city, Kock said.

The plan will now be presented to the council again on Wednesday on the request of the opposition parties.

The AEB, which was touted as the most innovative waste incinerator complex in the country in 2006, has long been plagued by problems.

Despite a capital injection of €16m, four of the six incinerators had to be closed this July, greatly reducing capacity at the plant. Most of the waste produced in the Netherlands is incinerated at the plant.