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ROCs are distorting the waste wood market

I have recently heard it said that ROCs (Renewables Obligation Certificates) are distorting the wood waste market and that the situation would be worsened by the introduction of the proposed Renewable Heat Incentive (RHI), due in April next year.  I thought this would be an interesting subject for my first column.

The recently published Waste & Resources Action Programme (WRAP) report Wood Waste market in the UK, stated that only 2 million tonnes of wood waste is recovered annually.  The recovered wood is in the top two or three grades, and the rest (2.6 million tonnes) goes to landfill.

Obviously I support the growth and development of new end markets for waste materials as a means of reducing their disposal to landfill.  And it is often the case that we need to introduce incentives to kick start the industry.  But the problem with ROCs and the proposed RHI is that they are acting as incentives for the development of biomass facilities which demand the same supply of clean wood that has been used by wood recyclers in the wood panel and chip board manufacturing sector for years.  ROCs make it attractive for generators of renewable energy to develop new, large scale, facilities which require high volumes of this material. 

As ROCs increase the price for clean wood, so it is being driven away from the traditional recyclers.  Some industry sources suggest that wood costs have risen by up to 20% recently, and while this is undoubtedly good news for the wood producers it does lead me to question how we can extract as much wood waste from landfill without jeopardising the businesses in the recycling industry who now claim that they can’t afford and can’t secure enough supply of their raw materials.

What might happen if ROCs were to be banded on material type, rather than just by the technology deployed, and incentives can be given to burn only lower-grade material rather than clean waste wood?

In my opinion there is room in the market for wood recyclers and biomass energy facilities.  What we need is to develop both financial and legislative incentives that will work together to encourage the segregation of different grades of wood to increase the overall volume recovered. 

According to the Environment Agency (EA) the majority of waste wood is contaminated, and until recently, there has been no available standard against which the waste material could be assessed, thereby making it difficult for wood producers and handlers to segregate into different grades.

I appreciate that the situation is further complicated by the requirement to comply with the Waste Incineration Directive (WID) which makes the use of waste wood with any kind of preservative treatment or coating less appealing to energy producers, who are more attracted to the clean wood waste. 

This market distortion seems to me to be a persistent problem with the emergence of any new waste stream for reprocessing – it reminds me of the issues caused for the glass container manufacturers during the initial development of recovered glass as aggregate and other low value materials.  I would challenge our sector to learn from these experiences and apply them in order to grow the recovery of wood waste effectively.

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