Councillors will discuss whether Sheffield should pull out of its waste contract with provider Veolia at a meeting next week.
The council would be expected to pay a figure running into millions of pounds to end the contract 19 years early. The deal was signed in 2001 and is not set to expire until 2036.
At present, Veolia is responsible for collecting and disposing of waste, running household waste recycling centres, managing and operating the Energy Recovery Facility at Bernard Road and the district heating network, picking up bulky items and the collection and disposal of abandoned vehicles.
Proposals are set to be discussed by Sheffield Council’s cabinet next week where members will consider alternative solutions to provide waste services in the city.
Coun Bryan Lodge, cabinet member for the environment, said the council was ‘operating in very tough financial times’ and the deal was ‘no longer meeting’ Sheffield’s needs.
The firm’s 180 Sheffield workers, who would be affected by any changes, would be consulted with, said Coun Lodge. Waste services would ‘continue to run smoothly’ as a priority until a new contract is signed, he said.
A Veolia spokeswoman said the company was ‘proud to stand by its operational record’ in Sheffield.
At the cabinet meeting next Wednesday, councillors are also being asked to consider changes to the way in which waste and recycling services are provided.
The main changes being proposed include replacing the blue box with an additional recycling bin; charging for new and replacement black bins and green bins and changing collection times to 6am to 9pm, Monday to Friday.