Throughout the centuries, economic development has been achieved by utilising resources with increasing degrees of efficiency, driven by innovation and strategic investment.
We don’t need to think that far back to recall how the North Sea oil and gas industry was supported and nurtured in the middle of the last century. I can imagine the ‘investor prospectus’ at that time spoke of great wealth locked up in natural assets, of new extraction technologies coming on stream all the time, of economic opportunities across the whole supply chain, of a favourable regulatory and policy background, and of public and private funds working together to unlock investment in the necessary infrastructure.
Fast forward to where we are today and for me there’s a clear case to approach the secondary materials industry in a similar way. We may be moving from an exploitative model to one which cycles resources within the economy, but the investment rationale is still largely the same.
The materials are out there and we know that these are not being utilised to their full economic value. We know that advances in collection, sorting and other more sophisticated forms of deconstruction are making the ‘extraction’ of those resources easier and more efficient - WRAP’s recent work on mixed plastics is a good example of that. We also know that the benefits of improved resource management can be shared both up and down the value chain, creating higher quality inputs to manufacturers and providing alternatives to exposure to volatile and costly virgin raw materials.
What’s more, government policy across all the UK administrations is focused on the economic benefits of resource efficiency. A key part of the role of Zero Waste Scotland is to identify and develop economic opportunities for Scotland from better use of the materials already circulating in the economy.
The new waste regulations in Scotland for example will be the enabler or the ‘extraction technology’ that will make commodities of valuable materials available to the economy. We need to quantify this in a way that potential new markets can be properly assessed, and ensure that where possible there is the opportunity to retain and maximise value for the Scottish economy.
Currently, as much as 750,000 tonnes of materials from the household waste stream is exported out of Scotland each year. Now that is a true definition of ‘a wasted resource’. No nation wants to lose the value of something it has. The new regulations are intended to be a stimulus to enable Scotland to retain this value and attract investment. A guaranteed supply of high quality materials will be a real incentive for businesses to invest and locate in Scotland, attracting high quality infrastructure and all that stems from this including jobs and a boost to local economies.
Alongside the supply of materials, finance is a key lever. In total Zero Waste Scotland manages around £13m a year of investment in infrastructure, capacity and innovation on behalf of the Scottish Government. This includes a Priority Materials Grant Fund and a loan fund which is focused on plastics reprocessing and other key materials. Often such finance can lead to new operations moving to the next stage of development or attracting investment from others.
I firmly believe that it is collaboration that holds the key to success. Call it partnership-working, bringing people together, facilitation…. It’s what helps unlock the barriers and provide workable solutions that deliver real changes and those new opportunities we’re all seeking. That is why the conference circuit is a real opportunity this autumn. Anyone who attends knows that in this sector conferences are anything but a ‘talking shop’. These can provide a real opportunity to beat the drum for investment in the UK resources sector.
WRAP and Zero Waste Scotland will be among the 750 exhibitors at the RWM exhibition in Birmingham in September. This event, billed as Europe’s premier waste management exhibition, is where we will be looking to engage as many people as possible to take advantage of the free expertise, support and funds we have available.
That the event is now co-located with major energy and water exhibitions is very encouraging to us. Businesses increasingly see resource issues as being interlinked which is why our Resource Efficient Scotland programme offers a one-stop approach to energy, water, waste and raw materials for businesses and the public sector.
October sees the Scottish Resources Conference. The conference, which we deliver in partnership with the Chartered Institution of Wastes Management (CIWM), is Scotland’s flagship event for resource management and resource efficiency. We’re deliberately broadening out the agenda to reach those new businesses and sectors, and potential investors, right across the economy, that have a chance to influence materials and products, how these are designed, produced and consumed, and how we can recover the most value from these at the end of their first and subsequent lives.
It is a Scotland-based event which exists in a global market and increasingly attracts a UK and international audience. Headline speakers this year include Scotland’s Environment Secretary Richard Lochhead, EU Commissioner Janez Potocnik, cradle-to-cradle pioneer Walter Stahel and WRAP CEO Liz Goodwin.
Debate and discussion is likely to focus on the immediate opportunities around Scotland’s zero waste agenda, particularly the upcoming introduction of new regulatory requirements for separate collections from January 2014, as well as the longer term opportunities from accelerating progress to a circular economy. For me, these elements combined are the ingredients for our own investor prospectus for Scotland.
We already have some great examples of indigenous reprocessing and high-value applications for secondary materials. From a glass remelt industry worth a potential additional £3.4m a year to the economy to major companies like Hewlett Packard specialising in IT refurbishment; and from innovative biofuel companies like Celtic Renewables and Argent Energy to smaller start-ups like Dryden Aqua finding new added value opportunities within the supply chain, it’s clear that the first few chapters of Scotland’s resource resurgence story are being written.
At this is just the beginning. Zero Waste Scotland research into priority materials shows there are a number of untapped opportunities right now, ripe for investment in Scotland and integral to building a more circular economy with new secondary markets. Plastics, WEEE, and textiles for example all offer new economic potential with job creation, new industries and return on investment.
This is the long game of course. We’re mindful of how dynamic commodities markets are and how demand and supply chain requirements may change over time. We need to hold a vision of what’s achievable and the benefits of starting down a path. For example, it may be that an economic case for a paper mill or aluminium smelter in 2013 may not be feasible or viable but we need to make sure that the possibilities of long-term needs and potential are fully explored. What we have in terms of materials and what we need in terms of products now may not be what the picture looks like in 2023 or even 2053.
As I start to prepare everything we need and want to say and do this autumn, the economic focus of Scotland’s policies is an incentive it would be hard not to see as ‘an easy sell’, something that could bring prosperity to those directly engaged and so many more could benefit from.
This new prospectus would be more than an exciting read for investors.
Iain Gulland, Director of Zero Waste Scotland