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Biffa warns of capacity gaps and calls for 'collaborative approach'

Biffa says the UK’s waste strategy is at a crossroads and needs a collective effort to development appropriate infrastructure throughout the waste hierarchy, including immediate action over a lack of landfill capacity.

The waste management company has produced The Reality Gap 2017, a follow up report to a 2015 version that focused on residual waste, which forecast a capacity in the UK of around five million tonnes per annum (tpa) by 2025.

Now, it concludes, the current gap of more than 13 million tpa will fall to six million tpa by 2025 but is unlikely to drop thereafter. It says this is its ‘realistic’ scenario while two other extrapolations produce gaps of three or 10 milion tpa by 2030. The report contrasts with a recent report from Eunomia discounting a capacity gap, and Biffa strongly challenges the consultancy’s conclusions (see Eunomia box below).

The latest report, as with the earlier one, has been prepared in-house by a team led by Jeff Rhodes, Biffa’s head of environment and external affairs. This time, however, it has a wider remit across the entire waste industry and also looks to a UK outside the EU.

Several aspects are highlighted:

  • Recycling: The UK now recycles around 45% of household waste and nearly 60% of commercial and industrial waste. But without further Government intervention through regulation or financial stimulus, the sector risks running out of steam.
  • Energy from waste: A better infrastructure is required if the nation is to more effectively convert residual waste into energy.
  • Landfill: The UK must accept that this still has a role to play in the waste hierarchy. Current capacity is running out, and replacement sites will need to be developed if the UK is to avoid a disposal crisis in the next 10 years (see landfill box below).
  • Brexit: The UK can no longer rely on the EU to set the waste management agenda so a more bespoke, realistic and resource-based solution can be developed.

Biffa chief executive Ian Wakelin called on all parties involved in the waste industry to take an ”imaginative and collaborative approach” when drawing up the UK’s strategy following our departure from the EU.

“The UK has achieved a great deal in terms of improving its environmental credentials. We should be proud of this. But we are at a crossroads when it comes to the future of our environmental strategy, made all the more critical and timely by the prospect of a post-Brexit world.

“The waste industry is more than capable of rising to these challenges, and needs clear policy direction to enable the necessary capital investments to be made.”

Wakelin said Biffa “relished the challenge” of working with industry and the Government to create an integrated solution.

Biffa on landfill capacity

Local availability problems will be experienced sooner and are already being felt in some areas, particularly London and the south-east. There are nine counties already with no landfill capacity at all and five England regions set to run out within the next 10 years, leaving half of English regions with no landfill capacity after around 2027.
 By 2025 London, east England, the south-east and south-west are forecast to have no remaining landfill disposal capacity.

For new landfill facilities, site finding, land negotiations, commercial appraisal, engineering design and environmental consents can take at least five and up to 10 years to secure. Since some areas
 of England have already exhausted their landfill capacity and overall capacity will run out in around 10 years, action 
is required now.

Biffa’s report suggests a landfill shortfall of three mililion tonnes by 2030:

biffa reality gap single1

biffa reality gap single1

Environmental Services Association executive director Jacob Hayler said: “This is another great example of one of our members informing and influencing the debate around the UK’s waste and resource management infrastructure needs.

“This is a critical time for the waste and recycling industry, and we need to take advantage of the post-Brexit opportunity to shape our future directly and realistically. We know that the Government is keen to gather this type of constructive input and industry knowledge, and believe that collaborative working has to be the best way forward.”

Biffa takes on Eunomia – extract from Reality Gap 2017

[Our 2015] capacity gap predications compared well with other analyses, with the exception of Eunomia. However, in Eunomia’s May 2014 Residual Waste Infrastructure Review it did agree with the influence of market correction on actual EfW capacity delivery, noting that “it seems reasonable to state that it is unlikely the UK would ever reach such a level of overcapacity, as each time a ‘merchant’ facility begins construction in a given locale, the likelihood of nearby merchant facilities reaching financial close falls”.

Unfortunately, in Eunomia’s latest (August 2017) report, it appears to have back-tracked on the unlikeness of actual overcapacity. That report has drawn strong criticism in the trade press from the ESA, accusing it of being flawed and highlighting that, in earlier reports, Eunomia predicted overcapacity by 2017 – yet we are still more than 13 million tpa short. This is a fundamental point given the UK’s reliance now on the private sector for investment in new capacity. 

Beyond 2025 we considered that a natural market balance would be reached and that this balance (capacity gap) would remain. This will happen when remaining waste (fuel) supply volumes are too low and/or too geographically dispersed to attract further, major capital investment in new infrastructure. This supply and demand element is often not reflected in desktop mathematical modelling, which typically assumes steady, continued market investment in the build-out of facilities, even against a shrinking feedstock market.

Biffa also produced this graph shwing how other recent reports on capacity diverge from Eunomia’s view:

biffa capacity reviews

biffa capacity reviews

 

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