Merseyside Waste Disposal Authority (MWDA) has begun its procurement process for a new waste disposal contract that could lead to the building of a PFI processing plant.
With its current contract up for renewal in 2008, the authority is preparing to consider a range of options for new treatment technologies.
As part of a 25-year joint municipal waste management strategy among the five Merseyside councils, a range of options are being investigated including incineration and mechanical biological treatment (MBT).
But the first option for the authority, which disposes of waste for Liverpool, Wirral, Sefton, Knowlsey and St Helens councils, is to rapidly increase recycling levels.
This will involve all five councils using the same standards and methods to boost recycling in Merseyside including the use of standard recycling binds and boxes.
The strategy will also consider whether to fine or place additional council tax levies on people who do not separate their waste, although this will not be policy of the councils for the time being.
MWDA chairman John Fletcher said: "It was agreed at a joint meeting in September last year that all of Merseyside's five districts would sign up to a single strategy for the whole region, which will mean cost savings on procurement and waste management. The strategy sets out targets and solutions that are financially acceptable, technically possible and will reduce the impact on the environment in the long term.
"It seeks to reduce waste, increase recycling and find new technologies that keep the cost of waste management at affordable levels. We will also look at diverting waste from landfill."
Merseyside currently produces 800,000 tonnes of waste a year and recycles 13.5% of this. The current disposal contract is held by Mersey Waste Limited.