As we put the finishing touches to our recently released report, RDF Exports: Here for Good?, I had chance to reflect on its findings and how the industry has evolved in the 10 years since I was managing landfills in Gloucestershire.
Back then, while recyclables had to be moved to markets, residual waste did not travel. With rising landfill tax hitting landfill volumes, competition between local landfills was becoming fierce – but I certainly did not think of extending my wall map beyond 30 miles. The market has since expanded to a truly European scale, as demonstrated by the incinerator on Mallorca taking waste from Naples in Italy and Portadown in Northern Ireland.
One of the challenges was therefore trying to work out how big to draw the 2015 equivalent of the old wall map, particularly in the light of the recent drop in oil price and corresponding reduction in logistics costs.
We concluded that while there remains the potential for some of the (smaller) newer EU members to export refuse-derived fuel (RDF) into northern Europe, if they did so, the volumes involved were likely to be relatively modest. Of the larger countries, Poland is looking to develop its own solutions while Hungary seems to have effectively nationalised its waste management industry. Italy is harder to read but exports remain relatively low.
Although the UK has several older incinerators – and the use of the ‘i’ word is deliberate because it is the most widely understood description – we have a rapidly expanding new ‘fleet’. It therefore came as a surprise how old some of the north European fleet is. By one measure, as at 2014, 20% of the more than 50 million tonnes of capacity is over 40 years old.
The data is far from perfect but it begs the question: how much of this capacity will still be around in five years’ time and how will this affect the overall supply/capacity balance?
This is not a simple question to answer. Extending an incinerator’s operational life can be economically rational, even in current markets. This is particularly so where the focus is on increasing a plant’s energy efficiency and reducing its reliance on gate fees. This suggests that the international trade in RDF could help ensure that only the ‘fittest’ (most efficient) incinerators survive. In this sense perhaps RDF exports could be here for good.
Adrian Judge is director at Tolvik Consulting