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How a court case may breathe new life into energy from waste

A search for logical coherence in the Luxembourg case law is probably doomed to failure. With that blunt criticism of the European Court of Justice (ECJ), on June 28 2007 Londons Court of Appeal delivered its landmark ruling on when recycled waste may be burnt as a fuel other than as waste, in the case of OSS Group Limited v Environment Agency (EA) & Others. The decision should breathe new life into the energy-from-waste (EfW) industry. In August 2005, while working on an EfW project, I advised that a new fuel product deliberately made from waste ceases to be classified as waste if it presents no greater harm to the environment than the nearest prime product with which it should be compared. In so advising, I was sticking my neck out because the consensus opinion at that time was that waste-derived fuel remained waste until it was burnt. That was, for example, the conclusion of representatives of Defra, the EA and the legal profession who attended a CIWM conference on the definition of waste in July 2005. So it was to the consternation of the EfW industry that on November 30 2006, the Administrative Court supported that conclusion, ruling in the OSS case that where a product derived from waste was to be burnt as a fuel, it did not ordinarily cease to be waste until energy was recovered from it. At that point the law was in a state of disarray. The OSS case had been linked to a case concerning waste solvent materials from which Solvent Resource Management Limited (SRM) manufactured product-grade distillates which were sold on the open market as recycled solvents. It was accepted that the recycled solvents ceased to be waste. But according to the EA, supported by the Administrative Court ruling, when SRM chose to burn the very same product in its plants as a home-grown fuel, it was or became waste again. Arguments Defra had a more subtle argument in the Court of Appeal, accepting that a waste-derived fuel could cease to be waste but only if it was hardly distinguishable from the non-waste alternatives, a test which was set too high for OSSs and most other waste-derived fuels. At that time, the law in England also differed from that in Scotland. Until the OSS case reached the Court of Appeal, the legal debate had lost sight of the fact that the European Directive in Article 3(1)(b) requires member states to encourage the recovery of waste by means of recycling with a view to extracting secondary raw materials and the use of waste as a source of energy. The Court of Appeal noted that the issue before it was of considerable economic significance because of the Waste Incineration Directive which applied from 2005. If the EAs argument was right, then a power station using fuel derived from waste would be subject to more costly controls those applicable to a waste incinerator than would apply if the power station were burning virgin fuel oil. Such a result could not meet Article 3(1)(b) objectives. In recognising the objective of encouraging the recovery of waste materials for uses which replace raw materials, the Court of Appeal decided that OSSs fuel manufactured from waste lubricating oil was no longer waste. It stated that: It should be enough that the holder has converted the waste material into a distinct, marketable product which can be used in exactly the same way as an ordinary fuel and with no worse environmental effects. Although the court stated that it was not laying down a def-initive test for the definition of waste because the ECJ had consistently declined invitations to produce one I nevertheless wonder whether, over time, that sentence may not emerge as a practical definition applicable to other recyclates. It is not altogether different from the EAs definition published in April 2006 in relation to the recycling of aggregates and soils: If you are treating a waste material to make it fit for purpose, then it will only cease to be a waste when it has been completely recovered. This state of complete recovery can be reached when the treatment process is complete and the recovered mat-erial is suitable for an agreed use and can be used without posing a risk to the environment. At the end of its judgement, the Court of Appeal urged Defra and the EA to join forces in providing practical guidance for those affected. It continued: It is unfortunate that the difficulties of interpreting the pronouncements from Luxembourg are compounded by the failure of the national authorities to agree a common approach. It is important that the national authorities should use their ex-pertise and experience to assist those concerned with the treatment and handling of waste. It is a sad reflection of current attitudes that it has taken three judges to give sustenance to the sustainable by removing the roadblock previously placed in the path of waste to energy recycling by the EA and Defra. Michael Krantz is a partner at solicitors Courts & Co

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