Government Office North East. A Study of Future Residual Waste Treatment Capacity and the Potential for Refuse Derived Fuel Production.

Transcription

1 Government Office North East A Study of Future Residual Waste Treatment Capacity and the Potential for Refuse Derived Fuel Production Final Report Entec UK Limited

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3 Report for Frances Wilkinson Senior Minerals and Waste Policy Officer Minerals and Waste Development Control Team Community and Environmental Services County Hall Morpeth NE61 2EF Main Contributors Lindsay Reed David Maunder Issued by Lindsay Reed Government Office North East A Study of Future Residual Waste Treatment Capacity and the Potential for Refuse Derived Fuel Production Final Report Approved by Entec UK Limited Linda Ovens Entec UK Limited Windsor House Gadbrook Business Centre Gadbrook Road Northwich Cheshire CW9 7TN England Tel: +44 (0) Fax: +44 (0) h:\projects\wm-220\ \16350 northumberland county council\g - general\draft report\government office north east final report doc Certificate No. EMS Certificate No. FS In accordance with an environmentally responsible approach, this document is printed on recycled paper produced from 100% post-consumer waste, or on ECF (elemental chlorine free) paper

4 Document Revisions No. Details Date 2 Draft Final Report 11/03/06 3 Final Report 31/03/06

5 i Executive Summary Introduction In October 2005, Entec was commissioned to conduct a study into the number, type and location of residual waste treatment plants planned for the North East Region in the short to medium term. The work built upon a previous study, namely a regional LATS capacity study prepared by Entec in March 2005, which considered the implications of the Landfill Allowance Trading Scheme (LATS) and where there may be potential shortfalls in capacity. The study was jointly funded by DEFRA under the Waste Implementation Programme Local the Authority Support Unit, the North East Regional Technical Advisory Body (NERTAB) and the DTI Renewable Fund and was conducted from October 2005 to February Objectives The main objectives of the study, as provided to Entec within the project brief, were: To improve the understanding of the implication of LATS in the region To quantify the shortfall in provision of treatment capacity and its geographical distribution To establish baseline data on the availability of waste material for energy recovery and facilities for the conversion of waste to energy To inform local waste strategies and their implementation. The study was further broken down into tasks to enable the achievement of the objectives. The first tasks (1-4) were concerned with Municipal Solid Waste (MSW) and the remaining tasks involved all wastes currently being landfilled within the region. 1. A schedule of current, likely and possible future provision for residual waste management on a sub regional basis; 2. Risk Assessments of proposed technologies including contractual, financial, planning, technological and legislation; 3. A comparison of the facilities identified in this schedule with the shortfall in capacity identified in previous work; 4. A schedule identifying: - Sub regions where additional facilities are required and timescales for their provision; - If and when there remains any shortfall in provision and when this is likely to occur;

6 ii 5. A schedule of current and planned facilities for conversion of waste materials to energy; 6. An estimate of medium and long-term future arisings of waste material suitable for generating energy, with its geographical distribution. 7. An estimate of the potential production and availability of RDF out of waste currently being landfilled; 8. An identification of costs and risks of MBT. Methodology The data collected in the 2005 Regional LATS assessment was revised so that better estimates could be made of the number and sub regional location of any residual treatment facilities that were definite, planned or just a possibility. The study then identified geographical areas where there remained a need for further residual treatment capacity and the timescale for such facilities were then identified. A questionnaire was sent to the relevant officer from each WDA requesting the following data: Current (2004/05) municipal waste arising data, including waste recycled, composted, treated and disposed; Information on residual treatment facilities including: stage of planning, potential start date, size of plant, technology, expected outputs and diversion rates; In addition disposal data on Commercial and Industrial (C & I) and Construction and Demolition (C & D) wastes within the North East region was also gathered. The data obtained was used to assume a composition of wastes disposed to landfill within the region and determine the quantity of waste suitable for conversion to energy, rather than disposal. For the purpose of this study, the Authorities information was further amalgamated to produce a sub-regional picture of residual treatment capacity requirement and the performance against the LATS. The data was separated into 3 potential performance scenarios as follows: Current facilities Plants that are in operation or currently undergoing construction or commissioning phases of the development process Planned facilities Plants that have been granted planning permission, although the construction of such plants may be subject to waste management companies securing contracts with Local Authorities Possible facilities Plants that are notional at this stage and reflect contractors longer term aspirations in the region. These plants would have to undergo comprehensive evaluation with respect to demand, funding and contracts as well as acquire planning approval. Information was also gathered from discussion with major waste management companies in the region. The discussions centred on the future plans of the companies in terms of residual MSW treatment facilities as well as treatment of C&I and C&D wastes. Data on tonnages and types of waste sent to landfill in the North East was also sourced from the Environment Agency and used

7 iii to estimate the quantity of potentially combustible of waste sent to landfill. The waste stream was further categorised to determine which materials were suitable for combustion or other forms of energy recovery. Conclusions Residual MSW Treatment Capacity Requirement in the North East The study found that 370,000 tonnes per annum residual waste treatment capacity was planned for the region in addition to the 300,000 tonnes currently available. A further 310,000 tonnes of capacity was also considered to be potentially available in the region in the long-term. A regional summary of the potential capacity for each of the LATS target years is shown in Table 1. Table 1 Potential residual MSW treatment capacity for the North East (tonnes per annum) Facilities 2009/ / /20 Current Facilities 296, , ,000 Planned Facilities 370, , ,000 Possible Facilities 180, , ,000 Total Capacity 846, , ,000 After consideration of current facilities and using a 1.5% linear waste growth rate, the additional capacity required within each sub-region, to meet the LATS targets was as follows: Tyne and Wear required approximately 200,000 tonnes of additional treatment capacity in 2009/10, 350,000 tonnes in 2012/13 and 500,000 tonnes of capacity in 2020; Durham required approximately 100,000 tonnes of additional treatment capacity in 2009/10, 200,000 tonnes in 2012/13 and 250,000 tonnes of capacity in 2020; Northumberland required approximately 20,000 tonnes of additional treatment capacity in 2009/10, 50,000 tonnes in 2012/13 and 100,000 tonnes of capacity in 2020; and Tees Valley did not require any additional treatment capacity. The study found after consideration of all current and planned plants, there remained a requirement for additional MSW treatment capacity for the region. The total capacity required within the region for the first LATS target year 2009/10 was predicted to range from 30,000 to 100,000 tonnes, depending on the rate at which waste arisings increase on an annual basis Figure 1 illustrates the additional capacity required within the region to meet the LATS targets, after inclusion of current and planned capacity. The chart compares the capacity required if

8 iv waste grows at a rate of 5% per annum, reducing to 0% by 2015 with the capacity required if waste grows at a linear rate of 1.5% per annum. Figure 1 Total Requirement for Residual Waste Treatment capacity in the North East (after inclusion of current and planned facilities) MSW capacity required (Tonnes) / / / / / / / / / / / / / / /20 Year 5% reducing growth rate 1.5% linear growth rate The addition of capacity provided by the possible facilities further reduced the requirement for additional capacity in the Durham and Tyne and Wear sub-regions. Under this scenario Durham required 30,000 tonnes of additional capacity in 2011 increasing to 125,000 tonnes in 2020 (assuming a linear 1.5% growth rate). The additional capacity required in Tyne & Wear had reduced to 25,000 tonnes in 2013 and 20,000 tonnes in the last target year of 2020 and no capacity was required in the intervening years. In summary, the Tees Valley sub-region is not expected to require additional treatment capacity and it is expected that Northumberland will secure sufficient treatment capacity through the PFI process to meet its LATS targets. It is not currently known what type of technology is likely to be used in Northumberland. Durham has an existing MBT plant and a strategy to build more plants, in pursuance of the LATS targets. Darlington, included within the Durham sub-region for the purposes of this report, is currently finalising a waste strategy and could seek EfW or MBT solutions to meet the LATS targets. When all potential capacity is taken into account, the Durham sub-region, according to the data and assumption applied, may still require residual treatment capacity. The Tyne & Wear sub region may not require further treatment capacity if all potential capacity is realised. If the capacity of the planned or possible plants is actually secured by authorities outside the region or by a different configuration of authorities within the region than assumed, then each sub-region could have a different MSW treatment requirement than illustrated in the report.

9 v If the local authorities intend to meet the LATS targets by purchasing permits in the short-term it is likely that the costs could be 4.7 million in 2009/10 (assuming a 5% reducing waste growth rate and cost of permits at 20) if only the current facilities are in place. If however the price of permits in 2009/10 is greater than the current average of 20/tonne, the costs could be vastly greater. The effect of increasing recycling across the region to reach 30% by 2009/10 was investigated using a range of assumptions and ultimately demonstrated that the region could meet the first target year for LATS (2009/10) by achieving 30% recycling, based only on current and planned sites. If the recycling rate remained at 30% for the period 2010 to 2020, further treatment capacity would be needed from 2010/11 onwards (5% reducing growth rate). If an average of 45% recycling were achieved by 2009/10 then no further treatment capacity would be required until The use of a linear 1.5% annual waste growth rate showed that if the recycling rate remained at 30% for the period 2010 to 2020, further treatment capacity would not be needed until 2011/12 onwards and if an average of 45% recycling were achieved by 2009/10 then no further treatment capacity would be required until Risks Associated with treatment technologies A number of risks associated with treatment technologies were reported, the most notable of which were planning risks and the risks that the technology will not achieve the performance levels claimed by the technology providers. A summary of the main risks associated with each generic technology is provided in Table 1.2. Table 1.2 Summary of risks for generic treatment technologies (i.e. possible facilities for the North East) Technology Risk Level of Risk In-Vessel Composting (IVC) Planning permission not granted Low Public Opposition (increased traffic or visual amenity) Markets for products do not materialise Medium Low Anaerobic Digestion (AD) Planning permission not granted Medium Mechanical Biological Treatment (MBT) Public Opposition (increased traffic or visual amenity) Requirement for source separated feedstock or pretreatment of MSW to prevent contmination Markets for products do not materialise Planning permission not granted Public Opposition (increased traffic, visual amenity, incineration of RDF) Markets for products do not materialise Products not suitable specification for end use and must be landfilled Medium Low Low Medium/High Medium Medium Medium

10 vi Technology Risk Level of Risk Failure to meet Landfill diversion targets Medium Energy from Waste Planning permission not granted High Public Opposition (increased traffic, visual amenity, hazardous wastes, pollutants) High Potential for production of Refuse Derived Fuel from all wastes currently landfilled in the North East The study found that over half of the C&D and C&I wastes within the region are re-used or recycled. The majority of the remaining C&I wastes, MSW and a quarter of C&D wastes are sent to landfill for disposal. Of the 4.4 million tonnes of waste landfilled within the region in 2004/05 it was found that nearly 2 million tonnes was classified as inert. A fraction of waste sent to landfill was categorised as unspecified or contaminated and the remaining wastes sent to landfill comprised 1.7 million tonnes categorised as general. It was assumed that all general wastes sent to landfill contained a similar proporation of combustible materials to mixed MSW and therefore could be used to produce a Refuse Derived Fuel (RDF) or Solid Recovered Fuel (SRF). It was predicted that 800,000 tonnes of RDF could be produced in the region which could generate enough electricity to meet 5% of the region s electricity demand. The regional infrastructure required to achieve the production of over 800,000 tonnes of RDF is significant and would require MBT capacity for 1.7 million tonnes of waste as well as facilities to recover energy from the RDF. An investigation into final markets for the RDF found that there are currently few markets for RDF although it is feasible to burn the fuel in existing cement kilns or CHP plants depending its calorific value (CV) and homogeneity. A technical Committee from the European Committee for Standardisation (CEN) is however currently developing a common European Standard for RDF which should enable greater understanding of the characteristics of RDF and the potential for use in existing plants. There is some potential for using RDF/SRF in existing energy plants in the Region, but a number of barriers are likely to prevent the creation of an active, liquid, market in RDF/SRF to emerge in the near term. However, individual opportunities for bilateral arrangements between RDF/SRF producers and potential consumers might develop in the short term. It is expected that any RDF/SRF production facility would have arrangements in place for onward marketing or disposal/recovery of output streams before financial backing is secured. Recommendations The regional perspective on meeting the landfill targets is not entirely clear as some Local Authorities have not yet decided on their waste management strategies or selected treatment technologies for the diversion of wastes from landfill. The region should keep a watching brief on the progress of each authority. It is suggested that some of the WDAs yet to commence procurement processes could form partnerships to ensure that economies of scale are achieved.

11 vii A joint working approach may also result in greater interest from the waste management industry as bidding for a single larger contract would require less time and resources than bidding for a number of separate contracts. The North East Centre of Excellence, set up to support Councils in achieving efficiency and improve joint working, is encouraging such partnerships to create efficiencies in procurement and in service delivery. It is also worth further investigating the potential for increasing significantly municipal recycling. The regional co-ordination of waste minimisation campaigns, introduction of alternate weekly collections and increased recycling could result in a significant reduction in the capacity required to treat remaining residual wastes. Similarly conventional recycling facilities and composting plants are more likely to be built in the short to medium-term than residual waste treatment plants. The region could potentially meet the LATS target for 2009/10 by increasing the average recycling rate to over 30% and reducing annual waste growth to less than 1.5% per annum. The region (GONE) should further engage with waste management companies, Local Authorities, the North East Energy Partnership group and financial providers to determine whether speculative (merchant) plants are feasible, or can be incentivised, within the region. Such Merchant plants could be constructed for the diversion of all types of waste from landfill, not just MSW and therefore be less dependent on contracts from the public sector. The regional energy sector should also further investigate the potential market for waste derived fuels and seek to open negotiations between waste management companies and combustion plant operators. In doing so, and alongside a regional waste minimisation and recycling campaign, the region should seek to change the public perception of energy from waste (including RDF combustion). It is recommended that further work is undertaken on understanding the composition and quantity of wastes produced and disposed of in the region, in particularly the C&D wastes, as the last comprehensive C&D survey was undertaken over 5 years ago. The Strategic Waste Management Assessment (SWMA) is produced by the Environment Agency for each of the 9 planning regions in England and one for Wales. The most recent SWMA for the North East was produced in 2000 although it is expected to be updated in the near future. The updated version will provide more recent and accurate information for the region on all types of wastes produced and will inform decision makers on the likely quantity of wastes requiring treatment or disposal within each sub-region. Such information will inform joint-working initiatives between authorities as well as commercial waste producers and waste management companies.

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13 ix Glossary of terms and acronyms AD ATT BMW CCL C&D C&I CLO CO 2 CV IPC IPPC kwh LA LATS MBT MJ MSW Mixed MSW Residual MSW MW MWh PFI PPP RDF Anaerobic Digestion Advanced thermal technology Biological Municipal Waste Climate Change Levy Construction & Demolition Commercial & Industrial Compost Like Output Carbon dioxide Calorific Value Integrated pollution control Integrated pollution prevention and control Kilowatt-hour Local Authority Landfill Allowance Trading Scheme Mechanical Biological Treatment Mega Joules Municipal Solid Waste Non source segregated MSW That fraction of MSW that is not recycled through kerbside or other types of recycling scheme Megawatts Megawatt-hour Private Finance Initiative Public Private Partnership Refuse Derived Fuel

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15 xi Contents 1. Introduction Background Objectives Sub Regions 2 2. Background Introduction Waste Sector Policy Drivers Waste Sector Policy Instruments The Landfill (England and Wales) Regulations The Waste and Emissions Trading Act (2003) The Landfill Tax Recycling Targets Summary 5 3. Schedule of Current, Planned and Possible Residual Waste Treatment Facility Provision in the North East Methodology Assumptions Conclusions of Previous Study (2004/05) Results of Study Update Conclusions Consideration of Current Facilities Consideration of Planned Facilities Consideration of Possible Facilities Sub Regional requirement for additional residual waste treatment facilities Potential Costs of LATS permits Increased Recycling Timing 23

16 xii 4. Risks Introduction to Risk Risk Assessment Discussion Energy from Waste Energy Sector Policy Drivers Energy Sector Policy Instruments The Renewables Obligation Order The Climate Change Levy (CCL) The EU Emissions Trading Scheme (EU-ETS) Other Possible Energy Policy Instruments Summary Energy from Waste Technologies Introduction Processing Mechanical processing Thermo-chemical processing Biological processing Chemical processing From Fuel to Heat Solid fuels Liquid and gaseous fuels From Fuel to Work From Fuel to Electricity Commercial Maturity of Different Technologies Energy from Waste Projects in the UK Energy from Waste Technology Providers in the UK Combustion Technologies Advanced Thermal Treatment Technologies Potential for Conversion of Waste to Energy in the North East Waste Arisings in the North East Introduction Construction & Demolition Wastes 45

17 xiii Commercial & Industrial Wastes Municipal Solid Wastes Potential for the Production of RDF from Wastes Currently Landfilled Introduction to RDF RDF or SRF Potential RDF Characteristics Estimated quantity and type of wastes currently landfilled in the North East Potential for RDF production within the North East RDF Markets Potential for RDF Use in the North-East North East Energy Sector Initiatives Introduction Renewable Energy North East Mechanical Biological Treatment Introduction to MBT RDF Plant Bio-stabilisation MBT Aerobic Composting Splitting MBT Anaerobic Digestion Splitting MBT Anaerobic Digestion CLO/Biogas Output MBT MBT Process Process Features Inputs Outputs Cost & Footprint MBT in the UK Environmental Impacts Risks Conclusions and Recommendations Conclusions Residual MSW Treatment Capacity Requirement in the North East Risks Associated with treatment technologies Potential for production of RDF from all wastes currently landfilled in the North East Recommendations 71

18 xiv Table 1.1 Sub Regions within the North East 2 Table 3.1 Percentage biodegradability of separated fractions of MSW (Landfill Allowances and Trading Scheme (England) Regulations 2004) 8 Table 3.2 Schedule of Current, Planned and Possible Facilities 11 Table 3.3 Summary of Status of Waste Strategies in the North East Region 19 Table 3.4 Key Stages in the procurement process 23 Table 3.5 Example of Indicative Project Phase Durations for a competitive tender process 24 Table 6.1 Commentary on different Energy from Waste processes 36 Table 7.1 Summary of C&I waste disposal/recovery by sub-region (Environment Agency Survey 2002/03) ( 000 tonnes) 47 Table 7.2 Fraction of waste arisings and theoretical RDF production in sub-regions (using 2005/06 data from Regional Spatial Strategy) 51 Table 8.1 MBT technologies and providers currently active in the UK 59 Table 8.2 Costs & Footprint for MBT plants 63 Table 8.3 Average Costs and Footprints of MBT technology types (from Juniper Report) 64 Table 8.4 Known MBT plant developments in the UK 64 Table 9.1 Potential residual MSW treatment capacity for the North East (tonnes per annum) 67 Table 9.2 Summary of risks for generic treatment technologies (i.e. possible facilities for the North East) 70 Figure 3.1 Sub Regional summary of residual treatment capacity required to meet LATS targets (Data from Regional LATS Assessment 2004/05) 10 Figure 3.2 Sub Regional summary of MSW treatment capacity required to meet LATS targets (after current facilities and using 5% reducing growth rate) 13 Figure 3.3 Sub Regional summary of MSW treatment capacity required to meet LATS targets (after current facilities and using 1.5% linear growth rate) 13 Figure 3.4 Sub Regional summary of MSW treatment capacity required to meet LATS targets (after current and planned facilities and using 5% reducing growth rate) 15 Figure 3.5 Sub Regional summary of MSW treatment capacity required to meet LATS targets (after current and planned facilities and using 1.5% linear growth rate) 16 Figure 3.6 Sub Regional summary of MSW treatment capacity required to meet LATS targets (after current, planned and possible facilities and using 5% reducing growth rate) 17 Figure 3.7 Sub Regional summary of MSW treatment capacity required to meet LATS targets (after current, planned and possible facilities and using 1.5% linear growth rate) 18 Figure 3.8 Regional summary of LATS permits costs after inclusion of facilities (using 5% reducing growth rate) 20 Figure 3.9 Regional summary of LATS permits costs after inclusion of facilities (using 1.5% linear growth rate) 20 Figure 3.10 Residual treatment capacity required after increased recycling and inclusion of current and planned facilities (using 5% reducing growth rate) 22 Figure 3.11 Residual treatment capacity required after increased recycling and inclusion of current and planned facilities (using 1.5% reducing growth rate) 22 Figure 3.12 Services required throughout technology procurement process 24 Figure 7.1 Estimated C&D waste arisings in the North East Region 45 Figure 7.2 Estimated C&I waste arisings in the North East Region 46 Figure 7.3 Estimated MSW arisings in the North East Region 48 Figure 7.4 Quantity and Types of wastes landfilled in the North East Region 2004/05 50 Figure 8.1 Overview of MBT systems 60 Figure 9.1 Total Requirement for Residual Waste Treatment capacity in the North East (after inclusion of current and planned facilities) 68 Appendix A Draft Schedule of Activities Appendix B Generic Risk Allocation Schedule Appendix C Summary Table

19 1 1. Introduction 1.1 Background In October 2005, Entec was commissioned to conduct a study into the number, type and location of residual waste treatment plants planned for the North East Region in the short to medium term. This followed on from a previous study, namely a regional LATS capacity study prepared by Entec in March 2005, which considered the implications of the Landfill Allowance Trading Scheme (LATS) and where there may be potential shortfalls in capacity. This report contains the output from this study and in addition investigates the quantity of waste available in the region suitable for conversion into energy. The study was jointly funded by DEFRA under the Waste Implementation Programme Local the Authority Support Unit, the North East Regional Technical Advisory Body (NERTAB) and the DTI Renewable Fund and was conducted from October 2005 to February Objectives The main objectives of the study, as provided to Entec within a project brief, were: To improve the understanding of the implication of LATS in the region To quantify the shortfall in provision of treatment capacity and its geographical distribution To establish baseline data on the availability of waste material for energy recovery and facilities for the conversion of waste to energy To inform local waste strategies and their implementation. The study was further broken down into tasks to enable the achievement of the objectives. The first tasks (1-4) are concerned with Municipal Solid Waste (MSW) and the remaining tasks involve all wastes currently being landfilled within the region. 1. A schedule of current, likely and possible future provision for residual waste management on a sub regional basis; 2. Risk Assessments of proposed technologies including contractual, financial, planning, technological and legislation; 3. A comparison of the facilities identified in this schedule with the shortfall in capacity identified in previous work; 4. A schedule identifying: - Sub regions where additional facilities are required and timescales for their provision;

20 2 - If and when there remains any shortfall in provision and when this is likely to occur; 5. A schedule of current and planned facilities for conversion of waste materials to energy; 9. An estimate of medium and long-term future arisings of waste material suitable for generating energy, with its geographical distribution. 10. An estimate of the potential production and availability of RDF out of waste currently being landfilled; 11. An identification of costs and risks of MBT. 1.3 Sub Regions The North East Region is, for the purposes of this study, divided into sub regions as follows: Table 1.1 Sub Regions within the North East Sub Regions Waste Disposal Authorities (WDA) Durham Durham County Council Darlington Borough Council Northumberland Tees Valley Northumberland County Council Stockton Borough Council Middlesbrough Council Hartlepool Borough Council Redcar and Cleveland Borough Council Tyne and Wear Gateshead Council Newcastle City Council North Tyneside Council South Tyneside Metropolitan Borough Council Sunderland Council All data gathered has been reported on a sub-regional basis.

21 3 2. Background 2.1 Introduction Historically the vast majority of the UK s MSW has been disposed of into landfill sites. Whilst the engineering of landfills has improved substantially in recent years, and the control over their environmental impact has increased greatly, landfill disposal still remains at the bottom of the hierarchy. Although this option still dominates the way in which we manage waste in this country (for instance, about 77% of England s MSW went to landfill in 2001/2), the UK s waste management industry is now changing rapidly. 2.2 Waste Sector Policy Drivers Driven in the main by a range of policy goals, regulations and economic instruments, the industry is moving away from one that is dominated by landfill to one in which technologybased processes form part of integrated waste management schemes. The aim of these schemes is to increase the levels of recycling, composting and recovery, so moving a community s waste management solution up the widely accepted waste management hierarchy, and to increasingly divert biodegradable wastes away from landfill. In addition, in some parts of the Country, the availability of landfill void space is heavily constrained, encouraging the adoption of processes that reduces the volume of material that requires this final disposal route. One of the Government s key goals in the field of waste management is to achieve the targets set out in the European Commission s Landfill Directive (Council Directive 1999/31/EC) for the diversion of biodegradable municipal waste (BMW) away from landfill. There is a range of policy instruments and regulations that have been established in recent years aimed at achieving these targets, and at increasing the levels of recycling and resource recovery from our wastes. According to Caledonian Economics 1 : Approximately a quarter of the total 5 billion investment required by the EU Landfill Directive has already been funded. To date, most of this investment has been directed at upgrading landfill sites. Most landfills operated by the leading waste management companies are now fully compliant with the Directive in terms of lining, leachate, pest control and amenity protection. But this still means that the industry faces a future bill of 4 billion to develop alternative waste treatment methods, such as recycling, composting and the recovery of energy from waste. It should be noted that the very recently released consultation on the Government s Waste Strategy may bring about further policy instruments aimed at accelerating the diversion of biodegradable waste away from landfill. And it is particularly notable that the Government, in announcing the consultation, very publicly stated its goal of increasing the contribution that 1 Financing sustainable waste management: the challenge of the new millennium. Caledonian Economics, April 2003.

22 4 Energy from Waste plays in the nation s management of MSW, from its current level of around 9% of MSW to around 27% in the medium term. 2.3 Waste Sector Policy Instruments The Landfill (England and Wales) Regulations 2002 These wide ranging regulations are having a number of effects on the management of landfill sites in the UK, ranging from tightening environmental management and engineering standards through to the restriction of depositing certain types of waste into landfill (such as waste tyres, for instance) The Waste and Emissions Trading Act (2003) This Act has brought into being the Landfill Allowance Trading Scheme in England, which sets firm targets for the quantities of biologically active municipal waste that Local Authorities are permitted to deposit into landfill sites. The limits are reduced each year up until If an English Authority exceeds its landfill allowance limit, it either has to purchase Allowances through the trading market or pay a penalty to the Government of 150/tonne (of biologically active municipal waste). 2 An Allowance is created for every tonne by which any Local Authority manages to come under its limit. The value of Allowances in the trading market will be capped by the 150 penalty level, but the actual price a failing authority will have to pay will depend on the market forces of supply and demand, and on the ability of the market players to bank Allowances and trade in futures. The current average price of allowances (2005/06) is between 20 and 40 although it is thought this is set to increase in the years preceding the first target year of In addition a national study on MSW treatment capacity and the ability of the UK to meet the EU Landfill Directive targets is due to be published in early The Kelly Review involves a comprehensive survey of local authority waste management and of private companies contracted to deliver waste management services. It is expected that the review will conclude that the UK is likely to struggle to achieve the Landfill Directive targets and that private companies are unlikely to be able to cope with the large numbers of tenders expected. The conclusions, whilst unsurprising, may succeed in focussing local authorities on formulating and activating strategies to enable achievement of the targets The Landfill Tax Landfill disposal costs have increased significantly over recent years. Direct operating costs have increased due to the stricter regulation of landfill activities, improved engineering standards, and the limited capacity of landfill void space. Indirect costs have arisen through the imposition of Landfill Tax, which commenced in October The tax is a levy specifically targeted on the disposal of wastes in landfill sites throughout the UK and has two main objectives: 2 The mechanism in Wales and Scotland operates differently.

23 5 To ensure, as far as practicable, that the cost of landfill properly reflects the impact which it has upon the environment; and To help ensure that targets for more sustainable waste management in the UK are achieved. Two tax rates apply; one for inert waste (waste that does not decompose or otherwise change) and one for active wastes such as municipal solid wastes. The current rate of active waste landfill tax is 18 per tonne (2005/2006). The Government has stated its intention to increase this by at least 3/tonne, reaching a level of 35/tonne in the medium to long term (i.e. by around ) Recycling Targets The Local Government Act in the UK has created a number of indicators for reporting the performance of local authorities to the Government under the Best Value framework. Two of these (BVPI 82(a) and 82(b)) have become statutory performance standards and refer to the achievement of recycling and composting targets. Local Authorities were set individual BVPI targets for 2003/04 and 2005/06 encourage the growth of both recycling and composting activities as part of local waste management solutions. The targets were capped at 30% although figures published by DEFRA in 2004/05 show that a number of authorities have achieved recycling rates in excess of 40%. On a National level, England achieved a recycling and composting rate of 22.9% for 2004/05 and the recent Consultation Document on the Review of England s Waste Strategy (2006) proposes national recycling rates of 40% by 2010, 45% by 2015 and 50% by Summary In summary, there are several key regulatory and policy instruments driving change in the management of waste (and, in particular, MSW) in the UK: The targets and penalties set in the Landfill Directive and the Landfill Allowance Trading Scheme encourage the use of waste processing technologies that reduce the amount of biodegradable wastes going to landfill; The Landfill Tax regime is effectively increasing the costs of disposal to landfill to the extent that other forms of waste treatment are becoming more competitive.

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25 7 3. Schedule of Current, Planned and Possible Residual Waste Treatment Facility Provision in the North East 3.1 Methodology The data collected in the 2005 Regional LATS assessment was revisited and revised to ascertain the number and sub regional location of any residual treatment facilities that were definite, planned or just a possibility. The geographical areas where there remains a need for further residual treatment capacity and the timescale for such facilities were then identified. To assist with this revision, a questionnaire was sent to the relevant officer from each WDA requesting the following data: Current (2004/05) municipal waste arising data, including waste recycled, composted, treated and disposed; Information on residual treatment facilities including: stage of planning, potential start date, size of plant, technology, expected outputs and diversion rates; In addition disposal data on Commercial and Industrial (C & I) and Construction and Demolition (C & D) wastes within the North East region was also gathered. The data obtained was used to assume a composition of wastes disposed to landfill within the region and determine the quantity of waste suitable for conversion to energy, rather than disposal. The data received from the Councils was inserted into Entec s in-house waste flow model to calculate the quantity of BMW diverted and consequently the residual treatment capacity required. The waste flow models were used to predict the surplus/deficit in permits achieved by each authority, using Government allocations. The information enabled an overall picture to be developed of the permits available to, or required by, the authorities on an annual basis projected up to the year For the purposes of this study, the Authorities information was further amalgamated to produce a sub- regional picture of residual treatment capacity requirements and the performance against the LATS. The data was separated into 3 potential performance scenarios as follows: Current facilities Plants that are in operation or currently undergoing construction or commissioning phases of the development process; Planned facilities Plants that have been granted planning permission, although the construction of such plants may be subject to waste management companies securing contracts with Local Authorities;

26 8 Possible facilities Plants that are notional at this stage and reflect contractors longer term aspirations in the region. These plants would have to undergo comprehensive evaluation with respect to demand, funding and contracts as well as acquire planning approval. Information was also gathered from discussion with major waste management companies in the region. The discussions centred on the future plans of the companies in terms of residual MSW treatment facilities as well as treatment of C&I and C&D wastes. Data on tonnages and types of waste sent to landfill in the North East was also sourced from the Environment Agency and used to estimate a composition of waste sent to landfill. The waste stream was further categorised to determine which materials were suitable for combustion or other forms of energy recovery. 3.2 Assumptions Where authorities could provide a breakdown of the tonnes of materials diverted in terms of biodegradability, as shown in Table 3.1, a calculation was used to determine the percentage of BMW in the remaining material sent to landfill. Where authorities could not provide a further breakdown of materials diverted from landfill, it is assumed that 68% of MSW landfilled is classed as BMW. Table 3.1 Percentage biodegradability of separated fractions of MSW (Landfill Allowances and Trading Scheme (England) Regulations 2004) Type of Waste Amount of BMW (% by weight) Card 100% Paper 100% Putrescible Waste 100% Vegetable Oil 100% Wood 100% Footwear 50% Furniture 50% Textiles 50% Batteries 0% Electrical & electronic equipment 0% End-of-Life vehicles 0% Fluorescent tubes 0% Glass 0% Inert Construction & demolition wastes 0% Metal 0% Plastic 0%

27 9 Type of Waste Amount of BMW (% by weight) Mineral Oil 0% Soil 0% The waste growth rates applied to the data were as follows: 5% annual growth rate in 2005/06 reducing to 0% by 2015/16 (from the growth rate applied to MSW arisings in the Regional Spatial Strategy); 1.5% linear growth rate from 2005/06 to 2020 (proposed annual waste growth rate from the Consultation Document on the Review of England s Waste Strategy (2006)). 3.3 Conclusions of Previous Study (2004/05) The largest shortfalls in LATS allowances, as identified from the 2004/05 assessment, were within the Tyne & Wear sub region. According to data received from the WDAs, the Tyne & Wear sub region is likely to require over 200,000 tonnes of treatment capacity during the first LATS target year of 2009/10 increasing to over 500,000 tonnes by 2016 (Figure 3.1). The shortfalls can be attributed to the following: The Tyne & Wear sub region consists of 5 unitary authorities and has a significantly larger quantity of waste arising than the other sub regions; A lack of agreed long-term waste strategies within the Councils making up the sub region; Minimal confirmed future provision of residual treatment/diversion of waste. The Tyne & Wear authorities were however in the process of developing strategies for longterm management of waste and evaluating options for diversion of waste from landfill. The data for Northumberland showed a deficit in permits following 2007/08. The Council was in the process of procuring a long-term waste management contract supported with PFI credits. The confidentiality required with the ongoing procurement process meant that the council could not provide information on treatment technologies, capacities of facilities or operational start dates. However, the Council intended to meet LATS targets, prior to the new contract commencement, through increased recycling initiatives. Durham was expected to have surplus permits for a number of years due to the assumptions applied to their choice of residual treatment technology and their estimated build programme for the facilities. The assumptions are listed in the Regional LATS assessment 2004/05. Darlington, grouped within the Durham sub-region, showed a shortfall in permits in earlier years therefore indicating that residual treatment capacity was required in this area. The Tees Valley region did not expect a shortfall due to their long-term waste management strategy centred on the use of the 230,000 tonnes per annum energy from waste facility in Stockton. The data from the 2005 regional LATS assessment indicated a requirement for

28 10 residual waste treatment in Tees Valley from 2011 onwards. The requirement for waste treatment capacity was attributed to a slight deficit in permits for Redcar and Cleveland, however it was expected that more recent data would show a surplus in permits as the Council would have successfully introduced an alternate weekly collection scheme resulting in an increase in recycling and a reduction in waste collected for disposal. Figure 3.1 Sub Regional summary of residual treatment capacity required to meet LATS targets (Data from Regional LATS Assessment 2004/05) Tonnes MSW / / / / / / / / / / / / / / /20 Year Tees Valley Durham Northumberland Tyne & Wear 3.4 Results of Study Update Four WDAs returned the questionnaire and therefore only their data was able to be fully updated. The data from the 2005 Regional LATS assessment was used for the remaining authorities as it was the most recent data available, however discussions were held with each of the WDA s planning departments to ensure that any large scale facilities were not omitted from the study. A number of waste management companies active within the region were also contacted and provided information on their future plans, outlined in the schedule of facilities (Table 3.2). Their anonymity has been retained as the majority of their future plans are subject to procurement, planning and commercial confidentiality. An exception to this is Hadfield Wood Recycling Ltd is about to start construction of a wood recycling facility in Teesside. This facility will receive approximately 100ktpa of waste wood material from a wide variety of sources, including furniture manufacturers, wholesale and retail hardware businesses, construction firms, demolition contractors, pallet and packaging firms, and importers and exporters. Material will be processed and sorted into a range of different product types, which will be put to beneficial use in a wide range of markets, including animal bedding,

29 11 surfaces (e.g. equestrian or play surfaces), panel board or energy. Hadfield has recently established an agreement with Sembcorp Utilities to provide wood fuel to the Wilton 10 biomass fired power station, which is in development adjacent to the Hadfield facility. Using the updated information provided by the WDAs on MSW data and from waste management companies on residual treatment facilities, a schedule of facilities over time was produced. The schedule is divided into current, planned and possible facilities by sub-region, as defined in Section 2.2. It details the estimated capacity of each plant in tonnes per annum and the proposed technology. The expected capacities for the current year and the LATS target years are shown in Table 3.2. The full schedule is provided in Appendix A. Table 3.2 Schedule of Current, Planned and Possible Facilities Facilities/Sub-Region 2005/ / / /20 Current Facilities Durham 30,000 tpa MBT 30,000 tpa MBT 30,000 tpa MBT 30,000 tpa MBT Tyne & Wear 36,000 tpa IVC 36,000 tpa IVC 36,000 tpa IVC Tees Valley 230,000tpa EfW 230,000tpa EfW 230,000tpa EfW 230,000tpa EfW Northumberland Total Current Capacity 260,000 tpa 296,000 tpa 296,000 tpa 296,000 tpa Planned Facilities Durham 90,000 tpa MBT 90,000 tpa MBT 90,000 tpa MBT 30,000 tpa EfW 30,000 tpa EfW 30,000 tpa EfW Tyne & Wear 100,000 tpa EfW 100,000 tpa EfW 100,000 tpa EfW 150,000 tpa MBT 150,000 tpa MBT 150,000 tpa MBT Tees Valley Northumberland Total Planned Capacity 370,000 tpa 370,000 tpa 370,000 tpa Possible Facilities Durham 30,000 tpa MBT 30,000 tpa MBT 30,000 tpa MBT 10,000 tpa EfW Tyne & Wear 150,000 tpa MBT 150,000 tpa MBT 120,000 tpa EfW Tees Valley Northumberland 150,000 tpa MBT Total Possible Capacity 180,000 tpa 180,000 tpa 310,000 tpa Total Capacity 260,000 tpa 846,000 tpa 846,000 tpa 976,000 tpa Where MBT is Mechanical Biological Treatment, EfW is Energy from Waste, IVC is In-Vessel Composting and tpa is Tonnes per annum

30 12 The information in the Schedule is based upon discussion with WDAs and with waste management companies. The current facilities are plants that are in operation or currently undergoing the construction or commissioning phases of the development process. Facilities that have been granted planning permission are shown in the table although the construction of such plants may be subject to the waste management companies success in the procurement process. In the event that such contracts do not materialise, some contractors have indicated that the proposed plants may be constructed for the treatment and diversion of commercial wastes from landfill. For the purposes of this study the capacity available from the planned plants has been divided amongst the Tyne & Wear and Durham sub-regions, however the facilities may not necessarily be situated within these sub-regions. Plants listed under possible capacity are notional at this stage and reflect contractors longerterm aspirations in the region. These plants will be subject to evaluation with respect to local and regional waste strategies, capacity demand and contracts. The available residual treatment capacity created by the possible plants is again divided between the Tyne & Wear and Durham sub-regions although the suggested facilities may not necessarily be situated within these subregions. After the consideration of the facilities at each stage and taking into account the LATS allowances, the quantity of BMW remaining (above that which is allowed to be landfilled) in each sub-region was used to calculate the approximate additional capacity required to treat such waste to meet LATS targets. 3.5 Conclusions Consideration of Current Facilities The inclusion of the residual treatment capacity classified as current within the relevant waste flow model for each sub-region showed that there remained a requirement for further treatment capacity, apart from in Tees Valley, where no additional capacity is required. The remaining MSW treatment capacity required to divert a sufficient quantity of BMW from landfill to meet the LATS targets, if the reducing waste growth rate used in the Regional Spatial Strategy is applied, is shown in Figure 3.2. The treatment capacity required if a linear growth rate of 1.5% per annum is applied is shown in Figure 3.3. The effect of the different growth rates on, for example, the Tyne & Wear sub-region shows that: Reducing waste growth rate- Tyne & Wear require approximately 250,000 tonnes of treatment capacity in 2009/10 and just less than 500,000 tonnes of capacity in 2020; Linear waste growth rate - Tyne & Wear require approximately 200,000 tonnes of treatment capacity in 2009/10 and just over 500,000 tonnes of capacity in Essentially the growth rate used in the Regional Spatial Strategy suggests that there will be a greater requirement for increased treatment capacity in the earlier years of the LATS than if waste grows linearly. However the requirement for treatment capacity in later years is similar whichever growth rate is applied.