MEMORANDUM BY BABTIE GROUP LTD (DSW 97)
The Government's Waste Strategy 2000 sets out
The need to minimise waste production
in all sectors, requiring education and incentives.
The need to recover and recycle materials
from waste, requiring value to be recovered from 67 per cent of
municipal waste by 2015, of which half must come from recycling
and/or composting. This requires the growth of markets for recovered
A shift away from reliance on landfill
as the primary disposal option, choosing alternatives through
Open reporting of pollution and health
risks associated with all types of waste management and a tighter
framework for the granting of operating permits and specification
of emission abatement systems.
Policy objectives are supported by a mixture
Legislative changes (primarily driven
by the EC Landfill, PPC and Incineration Directives).
Fiscal drivers (Landfill and Aggregates
Taxes and Climate Change Levies).
Education programmes (ETBPP, "Are
you doing your bit?" Campaign, National Waste Awareness Initiative).
Research programmes (such as incentives
for householders to recycle).
Development programmes and policy
changes to support new market development for recyclate (Waste
and Resources Action Programme).
Introduction of "Best Value"
allowing municipal authorities to choose service provision on
additional criteria to strict economics.
In Babtie's view, the UK Waste Strategy can
only be achieved through excessive cost to the community because
it ignores some fundamental inconsistencies about waste ownership
and origins. In addition, it has introduced universal targets
for waste diversion for municipal authorities irrespective of
the economic effect of such changes, without taking the opportunity
to review existing Regulations that place unnecessary costs of
waste management onto the local authority.
1. THE NEED
Despite the slogan "Polluter Pays",
and the effectiveness of the Packaging Directive in encouraging
reuse, manufacturers and retailers still pass on the cost of collection,
recycling and disposal of packaging and residual materials from
household waste to the municipal authorities. The municipal authority
has no control over the materials that will be placed in municipal
waste and no way of seeing how this may change over time, but
it has legal responsibility for the waste and is now expected
to achieve diversion and recovery targets within a "Best
Value" solution. Waste minimisation could be delivered more
rapidly and more economically by making industry directly responsible
for the wastes it produces.
The purchaser does not want to own the packaging,
and may not choose it for particular properties: it is simply
a way in which the product is delivered to him. Education, information,
incentives and research may help the public towards "Green
Purchasing", but only within the choices offered by manufacturers.
The likely lifespan of the product and both the quantity and characteristics
of the packaging are controlled by the manufacturer and the distribution
system, but the cost of disposal, recycling and treatment is borne
by the consumer or, in the case of household waste, the municipal
authorities through central and local taxes.
Of course, whoever is legally responsible for
the packaging, the consumer will pay for its ultimate disposal
either through direct purchase price or through indirect taxes.
If the cost of disposal of packaging was reflected in the purchase
price, perhaps simple economic choices by the consumer would encourage
green shipping. At present the fact that the Producer does not
suffer penalties for the disposal costs related to his product
means that there is less incentive to minimise the quantity of
packaging, to make it reusable or recyclable at sensible cost
or to maximise the usable life of the product. All of these increase
the amount of waste entering the wastestream.
The Packaging (Producer Responsibility) Directive
should have been an opportunity (as the name implies) to place
responsibility for packaging on producers. Unlike much of the
rest of Europe, this has not happened in the UK. We have allowed
producers to buy out their Obligation to show that a percentage
of their packaging waste is recycled or converted to energy through
targeting the cheapest elements of the wastestream available for
recovery, not the wastes they actually create. There is every
sense in targeting the easiest materials first, but the existence
of complex materials, unnecessary laminates, non-uniform colour
coding makes it more difficult and costly to segregate recyclables
and increases the likelihood of loads being rejected due to contraries.
Producers of complex packaging materials are increasing the costs
of recycling all packaging, but pay disproportionally less.
In addition, although a packaging product may
be distributed evenly across the UK, the Packaging Obligation
is probably met by a relatively small area adjacent to the main
reprocessors. Collecting recyclate from the nearest area minimises
transport costs and associated environmental impacts, and makes
environmental sense. However, with a limited market for the recyclate,
the Regions without local outlets receive the same share of the
packaging material, but bear an above average load of the current
fiscal penalties of Landfill Tax and the future penalties from
buying tradeable landfill permits, investment in above average
cost recycling schemes or from missed government targets.
The opposite should also be true: municipal
authorities near to reprocessors should be seeing savings as industry
pays for proof that materials are being recycled. In fact, additional
household collection schemes to meet government targets and commercial
waste recycling to meet the Obligations has flooded the market
in many commodities and increased the cost of all recycling by
reducing the price paid for many collected materials. The anticipated
new reprocessing facilities that were expected to be built in
response to market pressures and available wastestreams have not
really materialised and a large part of the UK's increased recycling
is due to additional exports of recyclate as far afield as South
East Asia. For some materials, such as plastic film, the export
market has been so efficient that UK reprocessing capacity has
had to shut rather than expand. (Alida Recycling, Derbyshire)
In addition, a proportion of the potential savings from recycling
are swallowed up by administrative processes associated with proving
that the waste has been recycled (essential), the monitoring of
this fact by sundry persons in the supply chain and the resale
of such evidence to third parties.
Elsewhere in Europe this excellent Directive
has meant three crucial impacts none of which are achieved by
the British Version.
Firstly, there is a direct tax on the cost of
packaged goods, at the point of sale, related to the management
cost of the waste packaging. This vital point means there is competitive
price pressure to reduce packaging or make it more amenable to
recovery/reuse. Consumers see the cost of packaging and can make
choices based on both waste minimisation and plain economics.
In the UK, the waste minimisation option may come with an increased
price tag because the reduced cost of disposal is not included
in the price.
Secondly, the extra money generated covers the
cost of separately collecting the material, either directly by
the manufacturers or their representatives or by the Councils
funded by a central pool. Waste Strategy 2000 requires municipal
authorities to recover large percentages of waste through recycling,
composting and energy values whether they are economic or not.
This will require separate collections: these will be funded through
general taxation and property taxes not by the waste producer.
Thirdly, it avoids investment in recycling or
reprocessing by, or on behalf of, Councils. The Packaging Tax
can be used to fund central reprocessing plant as well as collection
systems. Again, in the UK the waste strategy will require investment
in recycling and reprocessing by the councils or via council contracts.
This is the wrong place for investment to take place: the risks
will be borne by the council, but they have no control over material
supply. Only the manufacturer and retailers know whether they
will be investing in waste minimisation systems, changing from
cardboard packaging to expanded polystyrene, phasing out glass
bottles for plastic ones, bringing out new designer drinks in
laminated containers or installing waste gasification plants at
major supermarket sites to fuel the associated leisure areas for
the 2010 shopping malls. The Councils will be entering into long-term
contracts for waste handling and processing and either accepting
large financial risk by guaranteeing supplies or accepting unnecessarily
high gate fees to spread the risk with waste management companies.
They will be penalised for failure to deliver the right quantity
or quality of waste to their contractor, penalised if they take
a conservative approach and fail to meet government targets and
probably will pay an increasingly high price for the sale of recyclate
back to the packaging manufacturer/reprocessor who made it in
the first place because of increased competition for limited outlets.
The definition of waste by its origins ("household",
"industrial", "municipal" etc) is an historical
tenet of UK waste legislation based on the need to allocate fiscal
and practical responsibility for the collection and disposal of
waste from different sources. This was a perfectly satisfactory
solution when almost all waste ended up in landfill, but the future
requires waste to be collected, sorted, processed and treated
on the basis of waste content not on its origin.
The long-term BPEO for an area may be to recycle
20 per cent of biodegradable wastes from commercial, industrial
and household sources, compost a further 25 per cent, incinerate
a further 30 per cent and send the rest to landfill. The best
sources of waste for each component are based on their location
and content, not to the status of the producer. The requirements
for authorities to target recycling and composting of 33 per cent
of household waste only by 2015 is likely to result in separate
collection systems being introduced and plants being built in
the wrong location or of the wrong size for the whole wastestream
in the area. Furthermore, the need for municipal authorities to
"prove" that the waste is household waste will consume
more administrative resources for no environmental benefit. Without
monitoring, it could make perfect sense for a MRF to accept commercial
and industrial waste as well as a baseload of source segregated
household waste, and then send some of the household waste directly
to landfill rather than process it through the plant. All targets
would apparently be met, but the WCA would have spent money on
separate collection for no reason at all.
There are many good reasons to reduce the amount
of waste going to landfill and to increase the amount recovered,
but the source of the material is not really important. There
could be merit in revisiting this issue when the waste strategy
comes up for review and considering accepting higher diversion
targets for local authorities or regions but allowing the material
to come from any source.
The waste strategy targets will require additional
costs for waste management for research, collection, sorting,
treatment, disposal, and possibly to place recovered materials.
Most of these costs are the price of diversion from landfill and
might be considered fiscally neutral if wider environmental benefits
could be included in the calculations. However, there is a high
risk that a large amount of additional money will be spent on
monitoring exercises to check the origin of the waste and the
performance indicators, duplication of information to public and
industry and the trading in PRNs or Landfill Permits.
Our comments addressing the questions posed
in the Press Release amplify some of these points.
The Environmental Technology Best Practice Programme
has provided information, examples and on-site advice to a large
number of companies on minimising reject products, poor quality
supplies, process wastes and packaging materials. Manufacturers
pay for the waste they produce on site, and increased landfill
disposal costs, as the Landfill Escalator bites, will further
encourage waste minimisation.
Householders and small commercial users have
far less control over their waste production. They buy goods as
required and, individually, tend to have minimal purchasing power
to influence the manufacturer or supplier to change specification
of the goods or the packaging.
Education, information, advice sheets and the
like will allow a greater degree of informed choice to be made
during purchasing, and this may be particularly useful for identifying
the economic and environmental costs associated with the long-term
consumables associated with the purchase of new white goods, electronic
equipment or printing systems. However, this requires structured
information to be displayed at the point of purchase or in catalogues
since very little general information can be applied easily to
a specific purchase. Much information about environmental economics
is counter-intuitive, and the benefits of conflicting claims for
waste minimisation over recycling may be hard to judge standing
by the supermarket shelf or gazing at a catalogue if every supplier
can use their own choice or words to make environmental claims.
We believe that a fundamental change in the
use of resources requires a change in the Packaging Regulations
so that there is a charge to the manufacturer for the waste management
costs associated with their product which will encourage waste
minimisation at source rather than transfer of fiscal responsibility
for this to the community.
The waste strategy sets challenging targets
for the recycling and composting of household waste that will
also put the UK on course to meet the requirements of the Landfill
Directive to divert biodegradable municipal waste away from landfill.
There are no statutory targets for recovery of commercial or industrial
waste (other than through the Packaging Directive), although the
government wishes to encourage this and is looking for a reduction
to 85 per cent of the 1998 levels. Much of this reduction will
be delivered through existing legislation since the Packaging
Directive will have increased the amount of commercial and industrial
waste requiring diversion since 1998 and the Landfill Directive
bans the landfill of tyres. The Aggregate Tax and Landfill Tax
Escalator provide fiscal incentives for minimisation and diversion
so the target for diversion of industrial and commercial waste
seems quite conservative and perhaps could be increased.
Producer Responsibility initiatives can promote
new and greener products, design for recycling and new collection
systems. One of the problems with voluntary systems by individual
producers is that consumers and recyclers can get very confused
unless there is consistency across a market sector. It is understandable
that further developments often require an EC Directive to impose
consistent changes to manufacturing and distribution systems.
We have a few points to make on this section of the waste strategy:
1. Junk Mail is a problem, but is generated
by membership organisations (charities, building societies, store
cards) as well as by Direct Marketing companies. In a time when
all such material is generated by computer, and all computer systems
could be adjusted to provide a selected system for mailings, it
ought to be possible for a general Regulation that any individual
or company has a right to specify which material they want to
receive from different sources. For example, people may wish to
receive a quarterly magazine from a charity, but no interim appeal
information; or want investment information from a bank but not
whole life insurance or loan information.
2. Wherever possible and practical, the government
should push for recycling collection systems that feed used materials
back up through the product supply chain rather than requiring
separate collection and transportation systems. For many products,
such as batteries or fluorescent tubes, it is reasonable to give
the old units back to the supplier when purchasing new ones. There
is no need for collection and sorting systems to become a charge
on the tax payer. Legislative barriers to such systems (such as
requirements for waste management licences for storage and transfer
of hazardous wastes) should be considered now, and space allocated
in the parliamentary timetable to make the necessary changes prior
to the introduction of the proposed Directives for batteries and
Whatever the target level for recovery, development
of markets for recycled materials is the main concern. Market
development has been slower than expected even where the tonnage
of available raw materials has been increasing and the waste processor
has been able to charge more, or pay less, for the waste. Some
sorted materials have been sent overseas to fulfil increases in
recycling rate. Recycling has always been a international cyclical
business and international trade in secondary materials is part
of the overall solution, but it should not be the main solution.
Where there is no use for the material in the UK, or the costs
of reprocessing are so much higher than shipping it overseas,
then it is hard to see how recycling can be the BPEO. Possibly
we should be burning the waste and recovering energy.
Investment in equipment and buildings is a long-term
programme and it may be that there are various planned developments,
but in our view there are two main reasons for the lack of large-scale
1. Only the waste producer knows what his
short-term plans are for future manufacture since his long-term
production plans will be affected by the requirements for his
customers. Future waste content is therefore uncertain. This makes
long-term business plans hard to develop since there is no guarantee
of raw material supply, and thus affects the potential for funding
through standard financial systems.
2. The market for recycled products is, hopefully,
going to grow, but there are a lot of products where specifications
are non-existent or minimal at present and likely to be tightened
in the future. At the other end of the market, it is hoped that
more research or a change in production methods will allow tight
specifications to be relaxed to allow recovered material to take
the place of virgin materials in a wider range of goods. Such
uncertainties make it difficult to predict future sales and markets
and to purchase the correct reprocessing equipment. This again
affects Business Plans and the necessary acquisition of capital.
These uncertainties are likely to affect new
large-scale reprocessing plant, additional machinery and buildings
at existing sites and small-scale initiatives such as the development
of eco-parks. Businesses need long-term security of raw material
supply and secure markets to make it a commercial investment proposition.
If there is a requirement for new processing
plant and a market for the materials then perhaps there is a need
for underwriting of investment by the government to overcome some
of these problems. This could be as a direct grant towards the
construction of new plant, or perhaps a fund to underwrite losses
by councils if they fail to deliver material to reprocessors because
of an unforeseen change in the composition of household waste.
This would allow councils to sign up for long-term contracts,
with penalty clauses, to supply recovered wastestreams to reprocessors
based on an existing household waste analysis and a current prediction
of future arisings with confidence limits. The fund would protect
the council from unexpected changes to the wastestream, such as
major shift from glass to plastic or the reinvention of deposit
systems for certain major packaging systems.
As stated before, our preferred policy would
be to change the rules of the Packaging Regulations and place
a packaging tax on suppliers to encourage waste minimisation,
returnable packaging and the specification of recycled materials
to reduce the cost of waste management. This would reduce the
amount of waste within the system and might obviate some of the
need for new investment in sorting and processing.
In the short-term (perhaps to 2005), there is
probably an outlet for compost products of varying standards for
enhancement of derelict land, cover materials for landfill, garden
soil improvement, spreading on council or agricultural land. In
the longer term (to achieve the 2015 targets) there may be a need
for a much higher specification for composted materials to comply
with the proposed EC Sludge Directive, expected in the next decade.
The proposed Sludge Directive suggests lower
limits on the concentrations of some metals, organics and bacteria
allowed in sewage sludge spread on land, and the introduction
of equivalent controls for all other sludges spread on land. Allowable
limits of radicals are dependent upon the use of the land, and
there are time barriers to the spreading of sludge prior to harvesting
crops that vary with the treatment method for the sludge. Enhanced
treatment systems to reduce the likelihood of salmonella and listeria
residues have lower time barriers.
The Directive is in response to two pressures:
conservation and protection of agricultural soils and the risk
of food contamination. The latter is driven by the food industry
worried about the general contamination of food and specific worries
about any increased risk of contamination of organic food as more
land is used for this production system. On the whole, organic
land uses more sludges.
In the UK, pressures from food retailers has
brought in the Safe Sludge Matrix which effectively brings in
the provisions of the proposed EC Directive for the spreading
of sewage sludge onto land from next year and requiring new equipment
to be installed for some works.
Some water companies are opting for gasification
or incineration of sewage sludge, seeing this as the only secure
outlet. Others are developing marketing strategies based around
their enhanced product.
In the short-term, increased production of composed
municipal waste could take up some of the outlets that are now
closed, or are non-commercial, for sewage sludge. Longer-term
they will compete within the same rules, but the water companies
will have had at least five years to develop the best markets.
There is also a risk that retailers will require
MSW compost to meet the Safe Sludge Matrix if spread on food production
land, eliminating this potential outlet. It would then be hard
to market this as a "safe" product to gardeners.
There may be a benefit in accepting that MSW
compost must meet the same standards as for sewage sludge eventually,
and accepting these before new compost facilities are built to
meet the waste strategy targets. Compost products from MSW will
then be ahead of the legislation, rather than risking the chance
of health scares or poor quality material putting a blight on
this essential market if the strategy is to be achieved.
Such a decision would probably eliminate the
option of whole waste composting, except for specific requirements
for derelict land, and might require separate collection of green
wastes to eliminate metal contamination.
We perceive a contradiction within the strategy
between the need for authorities to deliver a Best Value solution
within BPEO and the practicalities of having to initiate a long-term
strategy that will deliver the required targets. This tension
could provide continual ammunition for public opposition to new
developments and will probably be seen first in the development
of new incinerator capacity. We are concerned that the understandable
desire to make environmental concerns a keystone of the decision-making
process puts unnecessary barriers in the way of developing core
facilities across the country.
Authorities need to be CERTAIN that some elements
of their strategy are guaranteed to be delivered and cannot plan
a long-term strategy based solely on a succession of unproven
technologies or initiatives requiring a change in attitude by
commerce and householders alike. The risks are incalculable, and
will translate into unnecessarily high gate fees.
Options such as intensive waste minimisation
and recycling can be set on paper to deliver up to 30 per cent
of waste diversion from landfill. Whether this is achievable in
practice depends on a range of unknowns from public co-operation,
changes in the wastestream and market outlets to the effectiveness
of the sorting plant. Putting a price on such a strategy is equally
difficult, making it hard to predict the cost of such an initiative
for the purposes of Best Value.
Processes, such as composting, are easier to
plan and cost, and the tonnage diverted can be calculated within
reasonably tight constraints provided the right material is fed
to the plant. There are still some uncertainties due to the cost
of educating the public in source separation and potential competition
for market share of the product leading to reduced prices.
Incineration is probably the only tried and
tested technology at present that will deliver diversion from
landfill and can assimilate a certain fluctuation in the wastestream
components. The main product, energy, will have a long-term market
and although there may be concerns about additional pollution
control measures in the future, the cost of the whole system can
be calculated and a business case made for capital investment.
For many authorities, incineration is a key factor in an overall
strategy providing a pivot which guarantees a certain level of
diversion from landfill, and allows intensive waste minimisation
and recycling as well as composting to be adopted in tandem.
However, incineration is a long-term commitment.
During the 25 year life of the proposed plant there may be a whole
range of new, and maybe better, tested technologies available
and it is hard to see how any authority can state that incineration
is the long-term BPEO for any wastestream.
Despite the waste strategy acceptance of energy
recovery from waste as a valid method to attain diversion targets,
it does not provide additional mechanisms whereby local authorities
can prove a need for new facilities when entering the planning
In the short-term, this is not a major problem.
Diversion targets over the next five years can be accommodated
by intensive recycling and composting schemes with landfill providing
the "pivot" technology that absorbs fluctuations in
the wastestream. As the diversion and utilisation targets increase,
more and more areas will need to rely on tried and tested technologies
to guarantee reaching the targets and there needs to be some mechanism
within the waste strategy to assist in proving a need for this
Assuming that the UK wishes to keep the current
diversion targets (some of which are required by the Landfill
Directive), our suggestion is that local authorities should undertake
a BPEO assessment and an assessment of costs, but be allowed to
identify a need for up to 30 per cent of their future waste management
provision on the basis of guaranteed technology and/or price even
if this is NOT the BPEO.
At a time when more research is needed for waste
treatment systems, and funding is needed to undertake and monitor
pilot projects, there seems no justification for allowing Landfill
Tax money to be spent on general environmental improvement projects
than can obtain grants from other sources.
Either the Landfill Tax credit scheme should
be abolished and the monies saved directed into research projects
run by NERC or DETR; or the Credit Scheme should be run by an
independent body, concentrating on the scaling up of research
projects to pilot and full-size schemes.
The Landfill Directive will have more impact
on the future of hazardous waste management than the Government's
Waste Strategy, and the acceptance conditions for different categories
of landfill have not yet been agreed within the EU. Waste Producers
will have to re-evaluate their waste production and disposal strategy
in the light of the new restrictions and look for alternative
One area of concern is hazardous materials in
the household and commercial wastestream: stains, resins, paints,
biocides, batteries, fluorescent light fittings, adhesives, motor
oil and cleaning materials. As with packaging materials, the disposal
of this fraction of the wastestream is paid for through taxes.
The EC is considering a Directive to require the separate collection
of household hazardous waste, and is letting a research contract
at present to review existing collection systems and the likelihood
of alternative materials being substituted for hazardous components.
Even if there is no EC Directive, some authorities will need to
remove hazardous household waste from composting lines or MRF
intakes and then pay for its disposal.
Manufacturers are conducting research in this
field and many products will be capable of substitution. The paint
industry has radically reduced the solvent content of paints over
the last decades and continues to look at new formulations for
coatings and cleaners. For example, calendula oil may be a sensible
substitute for white spirit.
The new products are likely to be more expensive
than the old. Apart from the development, sales and advertising
costs, they will need new equipment for manufacture. If the cost
of collection and disposal of household hazardous waste is to
be borne by local authorities, then there is no incentive for
consumers to buy the new products or for retailers to stock them.
We consider that the government should make
plans now to place the responsibility and cost of disposal of
hazardous household waste, and similar products sold to commercial
companies, on the waste producer and retailer. This should be
phased in over a reasonably long period (seven years?) to allow
for the necessary adjustments in the supply chain and the system
could target the most difficult wastes first, requiring specific
markings on the nominated materials and packaging to alert the
public that this is a hazardous material and requires them to
take additional care in its disposal.
One option could be that retailers and wholesalers
must receive unused products, waste products or contaminated packaging
back from the user and pass it back up the distribution chain
for bulking and disposal. Deposit to be paid on the container
to encourage returns by the public and provide some income for
materials separated from the wastestream by authorities or reprocessors.
The system would increase the cost of supply
of the more hazardous materials, encouraging consumers to take
the non-hazardous alternative where possible and would also encourage
retailers to stock and promote the less hazardous option to avoid
the cost of handling the waste.
It is very good news that the government is
promoting the specification of goods with recycled content.
It would be even better if they established
an intranet link for all government users of the new products
to discuss problems arising from trying to purchase and use these
materials, and the solutions. This could be invalidation of leasing
arrangements for photocopiers, inability to buy small quantities
from local suppliers, inconsistency in supply. For preference,
the comments should be widely available, but to allow users to
be frank without risk of libel action later, perhaps the intranet
site could be closed and a newsletter available from the DETR
site on a regular basis.
Many companies would like to introduce green
purchasing policies, but find themselves facing much higher prices
or contradictions with other existing contracts. The effort to
resolve these problems is too much additional work. If the government
develops standard letters to validate environmental claims or
to challenge lease conditions, identifies companies who are willing
to lease equipment to work with recycled paper, finds people who
will sell small quantities of recycled paper at a reasonable price,
or sets up systems for monitoring their purchasing systems, then
it would be useful to have such examples of good practice available
for others to use.
Chris Maltbaek, Tricia Marcouse