Energy recovery in UK waste management after Brexit

As the EU and the UK seek to move towards a more circular economy, in which waste is either prevented altogether or brought back into productive use, is there a continuing role for recovering energy from waste, alongside recovering materials? Roy Hathaway, Europe Policy Advisor at the Environmental Services Association, considers the prospects for the UK waste-to-energy sector

As I write this in January 2018, the uncertainty surrounding the future direction of waste management policy in the UK is starting to clear, but has not been completely dispelled. The government has just published its 25 year Environment Plan, which has a chapter on increasing resource efficiency and reducing pollution and waste, and includes a section on improving management of residual (i.e. non-recyclable) waste. But the Department for Environment, Food and Rural Affairs (Defra) has yet to produce its resources and waste strategy which, we are told, will supply the necessary supporting detail on how the Plan’s ambitions will be realised.

Similarly, in Brussels, the European Parliament’s Rapporteur and the Presidency of the Council of Ministers have reached provisional agreement on the Circular Economy proposals amending EU waste legislation. But, assuming this agreement is formally adopted by the EU, we don’t yet know whether the UK government will convert the new EU legislation into UK law in its entirety, or will make adjustments to render it more suited to UK circumstances in a post-Brexit world.

UK recycling rates
What do these emerging policy developments mean for the future of waste management in the UK? I’ll start with the prospects for recycling rates, as this will to a large extent determine how much non-recyclable residual waste will be left over and potentially available for energy recovery.

The provisional Circular Economy agreement would set municipal waste recycling targets of 55 per cent by 2025, 60 per cent by 2030, and 65 per cent by 2035. These are not directly comparable with the current EU recycling target of 50 per cent by 2020 for household and similar waste because they are based on a different calculation method. But the key point is that the Circular Economy package does not contain any significant measures to grow the markets for recyclable materials, many of which are currently weak. This means that achieving the new EU targets looks problematic.

This is particularly true for the UK. The recycling rate in England, which accounts for over 80 per cent of UK recycling, has stalled at around 45 per cent. There are a number of reasons for this, but the biggest single factor is the absence of sufficient demand for recyclable materials at a price which makes it economic to collect and sort them to the required standard. For too many materials, notably plastics, manufacturers still prefer to use virgin raw materials rather than recycled materials.

Moreover, UK recycling rates are very dependent on exports, and China’s decision to impose tighter restrictions on its imports of recyclable material is likely to put further downward pressure on prices. Unless governments in the UK and elsewhere put in place strong new measures to increase demand for recyclable materials – for example via mandatory eco-design rules, extended producer responsibility, or green public procurement – the Environmental Services Association (ESA) estimates that UK recycling rates are unlikely to rise much beyond 50 per cent by 2030.

Sustainably increasing UK recycling rates
So there is a lot riding on Defra’s resources and waste strategy, expected later in 2018. Will it endorse the newly agreed EU recycling targets, or will it diverge from them, reflecting Defra Ministers’ well-publicised dislike of weight-based targets? If so, what will the alternative UK targets be? And most of all, will Defra’s strategy contain credible measures to sustainably increase UK recycling rates beyond 50 per cent - and at what cost?

This matters because if waste cannot be prevented, re-used, composted or recycled, then the remaining options are either to recover energy from it, via combustion or other technologies, or to dispose of it to landfill, which for most materials is the least preferred option. It is not defeatist, but simply realistic, to say that by 2030 or 2035 we as a society are not going to be able to prevent, re-use, or recycle all of our waste. There will still be residual non-recyclable waste. The question is, how much will there be, and what is the best means of dealing with it? This is why recovering energy from waste can play an important role in the more circular economy of the future.

In recent years the UK’s waste to energy sector has grown rapidly, to the point where it now deals with around 38 per cent of UK household waste, reducing landfill to a mere 16 per cent. Initially this growth was fuelled by Defra’s PFI programme, designed to ensure that the UK met its EU landfill diversion targets. Once Defra was satisfied that had been achieved the programme was ended and since then UK investment in energy recovery facilities has been mainly by the private sector.

Over the past five years, the industry has invested around £5 billion in UK recycling and recovery facilities. ESA and its members have commissioned detailed modelling exercises to understand what further investment is required for the future. Their conclusions are clear: based on the most realistic estimates of future recycling rates, the UK needs significant additional energy from waste capacity to complete the move away from landfill and to complement recycling.

If recycling trends follow those of more mature recycling societies in other parts of Europe, then the industry expects that the UK may achieve medium to long-term municipal waste recycling rates of 55 per cent. At this level of recycling, it is forecast that the UK’s residual waste treatment capacity gap will be almost six million tonnes in 2030. It remains to be seen whether Defra’s resources and waste strategy will contain measures that will change these assumptions.

Some commentators have expressed concern that the UK may be heading for over-capacity in energy from waste facilities, and that this risks holding back UK recycling rates. The available evidence suggests otherwise. The UK is still landfilling 16 per cent of household waste and a similar proportion of commercial waste. The UK also exports over three million tonnes of refused derived fuel (RDF) to energy from waste plants in other EU countries. Moreover, because current and future investment in UK waste to energy plants is mainly by the private sector, we safely assume that investors will not come forward unless they are satisfied that there will be sufficient feedstock for the new facilities. If the private investors get their sums wrongs, they will bear the cost – not the public purse, as is the case in many other EU countries.

The worst of all worlds would be if Defra were to announce new higher recycling targets but take insufficient action to make them happen. In this case, the UK would face a significant shortfall in residual waste treatment capacity, meaning either a reversion to landfill or an increase in waste crime – something nobody wants to see.

Energy recovery from waste can play an important role in preventing this unwelcome scenario. Provided the UK government puts in place the right long-term policy measures, the private sector waste companies will be able to deliver the recycling and residual waste treatment capacity needed.