Recyclers need to improve risk management strategies to counter a dramatic increase in the number of fires at recycling centres over the last couple of years.
Waste sector insurance companies say that the rise in the number of incidents is driving up the cost of cover and the increasing number and value of claims could even risk making the sector impossible to insure.
Research by MRW last month listed 59 fires at sites of recyclers and reprocessors last year. However insurers say that the number is conservative and that larger stock piles of material, new processing methods and inadequate understanding and management or risks is contributing to a greater number of incidents.
Paul Evans, director at broker Butler Evans said that the growing number of fires was likely to be stoked by an increase in the number of operators coming into what was a relatively young industry.
He said: “The industry has grown rapidly and the risk management experience and expertise has not been able to develop to the required degree to enable business owners to understand how to avoid fire risk.”
Evans predicted that the frequency of fires would increase as younger businesses matured and accumuated waste, and warned that insurance cover would become more difficult to acquire.
“The majority of insurers do not have the time or resource to investigate trends such as these and simply stop offering insurance,” he said. “Once one or two major insurers have stopped insuring these risks, very quickly others will follow their lead in the belief that there is something inherently wrong with the recycling industry. We are at this point now and it is becoming increasingly difficult to find competitive insurance.”
David Bearman, managing director of broker Waste Insure, said the company had also noticed more fires. “There’s been a marked increase in the last 24 months,” he said. “We are not necessarily seeing more operators in the sector, but more changes in the waste industry and the fact that the material that would previously have been sent straight to landfill now has value.”
The danger of spontaneous combustion of black bin waste is a well known issue but in a lot of cases companies needs to become much more aware of it.”
“It’s becoming more and more difficult to insure, premiums go up, the excess goes up and cover is limited and more waste management companies are taking the risk themselves.”
He added: “Firms need to have businesses continuity plans and know how to deal with what happens after a fire. Many are not equipped to survive after a major catastrophe.”
Firefighters tackled a blaze over Christmas at a waste treatment facility at Kilbagie Mill, near Kincardine in Fife, Scotland. The fire in a warehouse at the site, operated by Oran Environmental Solutions, involved recyclable material such as clothing, mattresses and paper. Noone was injured.
Other significant incidents last year included a large fire at Wood Recycling Services near the M1 in Hertfordshire which burnt for over a week in November, and led to the temporary closure of the motorway. The Environment Agency had previously told the company to reduce the amount of wood waste on the site.
In addition, more than 200 firefighters and 40 engines tackled a huge blaze in August, at Hunts Waste Recycling Centre in Chequers Lane, Dagenham, East London. There were no injuries reported at the site.