Energy from waste (EfW) is a tricky project from the perspective of planning and the electorate, but an exciting prospect in terms of technology and business.
It could be used to help the UK improve landfill diversion and provide part of the answer to our energy problems. So why is it treated as a bit of a dirty secret?
Defra backs those who believe there will be enough EfW projects in the UK to meet demand. But what does industry think?
Pannellist Chris Jonas said that, by 2020, assuming recycling targets are met, there will be up to 25 million tonnes of residual waste to treat with only 15 million tonnes of capacity to meet it. That is a stark contrast to what Whitehall is saying. So why the confusion?
“There are many commentators and projects out there. If you add them all up, you are going to get 40 million tonnes worth of capacity,” said Jonas. “But they are not all going to happen.”
The panel consensus was that, with 206 thermal treatment facility plans on the drawing board up and down the country, around 20-30% would actually be built. But the real question according to the experts was not simply whether there will be enough capacity, but whether it will be in the right places.
“We need to look on a sub-regional basis. There are areas of the country where there may well be more capacity constructed than immediately adjacent feedstock,” said Jonas. “Some local authorities and waste companies may find it easy to continue to export any overcapacity, if they are near a port. But there are other urban areas where we will see a significant shortage of infrastructure.”
The confusion over what is really happening with EfW capacity appears to have sprung from the present topdown approach to analysis. David Beadle argued that this ‘bird in hand’ approach – as Defra has taken in the past with its PFI credit funding – should not be allowed to prevent facilities being built: “Particularly if you can bring together the money, the waste and a long-term need.”
But the Government’s message that there will be overcapacity is damaging investor confidence, of which commercial and industrial (C&I) EfW is a casualty.
Keith Riley argued: “This has made the banking fraternity very conservative and very demanding on what covenant you have on the waste supply going into a merchant facility.”
He added that the waste sector also needed to evolve into a much more sophisticated and co-ordinated entity: “The waste industry has five or six large companies and 3,000 very small ones – the market is predicated on guys with skip lorries picking up bins.”
Tom Anderson compared this set-up with the more slick wood fuel energy industry, where the supply chain is well structured, organised and international. Companies such as Drax have even bought up their own supply chain.
“On the waste management side, once you get to that smaller local scale, there isn’t that structured supply chain. There isn’t that security of supply or quality of feedstock,” Anderson argued.
From an international perspective, Chindarat Taylor noted how frustrating it was for the UK sector compared with other countries, such as those across Asia, where there is a strong push towards EfW because “waste is literally pouring out on to the streets”, is affecting quality of life and the gate fees are very low.
The panel noted that there were likely to be fewer Government subsidies in the future, and the confusion over the switch from ROCs to CFDs would, again, result in reduced investor confidence. The renewables sector could respond to these difficulties with a move into decentralised energy schemes, both in terms of power into local grids and in urban areas in terms of heat. This might support the C&I based schemes and bring benefits around security of supply.
Anderson argued that moving towards smaller scale, decentralised technologies linked into district energy schemes reduced the risks associated with security of supply and logistics.
“If those smaller scale technologies can produce high-value products, instead of it just being a mass burn incinerator producing hot air, they can produce syngas which you can turn into chemicals and you can produce electricity,” he said.
“The difficulty is that those technologies are less proven, and are less tolerant to variants and poorer quality feedstock. Therefore, as investors, contractors or local authorities, it is very difficult to back those technologies today.”
Joanne Wood pointed out that, in 2014, around 2.8 million tonnes of refuse-derived fuel (RDF) was exported, according to Monksleigh’s research.
Traditionally, Scandinavian countries such as Sweden and Denmark – which are currently undergoing a plant construction programme – are big customers for EfW.
But, by the end of 2015, this figure is likely to sit at the 3.3 million-tonne mark, and Wood argued that the rate of increasing RDF export has “tailed off ”.
Meanwhile, 12 EfW plants in the UK are under construction and, as this capacity comes online, Jim Clay points out that it “might start to pull some of that waste back” further. This could start to change the dynamics and bolster investor confidence. (More from Clay here).
However, exports will still probably be a cost-effective option for waste arising in the eastern seaboard of the UK going to the western seaboard of northern Europe, argued Jonas: “When you start to go further east in Europe or further west in the UK, I think cost becomes much more apparent.”
Anderson suggested that a biogenic profile should be included in RDF, which would result in a higher quality SRF fuel. He argued that this could really “start to change the economics of the market”. He added: “If you have a very high-quality material and highpriced RDF with a high biogenic content, you would effectively be cross-subsidising the costs of getting rid of poorer quality end-of-life plastics, for example, as well.”
Jonas suggested that the UK probably already had the infrastructure to support the production of better grade fuel: “If your interest is in promoting the newer technologies, much of that is about the need for proper, correctly specified fuel.
In the UK, we have 20-something proper mechanical treatment plants producing around 2.5 to 3 million tonnes worth of better grade fuel or fuel.”
Wood pointed out that some smaller, newer technology plants were planned with recycling facilities on the front ends: “They can take a proportion of unprocessed waste that will go in the facility’s MRF on the front end and be processed. Then it can go straight in the gasifier as a higher level fuel than when it came in from councils. Planning does seem to be moving towards that model.”
Kieron Parker said there was an argument for the standardisation of RDF. The oil and gas industries have developed quality standards themselves and this is what the waste industry needs to be doing, he said. But within the industry there were different agendas, although the cement industry had come up with a standard.
Beadle argued that to achieve tighter quality standards for RDF there would be a requirement for greater co-ordination across the industry rather than the current market-orientated situation.
Robin Latchem pointed out that an argument levied against EfW is that it will compete with recycling. But Taylor argued: “In Europe, reduce, reuse, recycle is a lot more mature – you need to demonstrate that you do all those before you do energy recovery, so no.
“In the Netherlands and Scandinavia, for example, they have high recycling rates but they also have high EfW capacity, so it appears to have very little impact on recycling rates.”
Beadle said there was no evidence that EfW had interfered with recycling so far: “My worry is that we are all the time comparing apples and pears: different countries have different approaches to the metrics, and different things are in the recycling. Why don’t we count recycled bottom ash in EfW as part of our recycling as some others do?”
There was agreement among the pannellists that we need consensus around the way we measure recycling performance. Jonas argued: “The real challenge on how we are doing to achieve our 50% and then possibly 70% recycling rate is how we are doing the maths and what resources we can devote to this.”
On to the issue of cost in a circular economy, Beadle argued that the model needs to be questioned, “because who is paying for all that? It isn’t the people who are creating it or who have got value out of it and profit out of selling it, and it isn’t really being paid for by the people who are getting utility out of the object either because, when they throw it away, the cost is just not apparent to them.
“So surely the model has got to be to push some of these costs back up the pipe and say if you want to design and sell a product, you have got to consider the waste in a practical way.”
Anderson said this could present opportunity because electric vehicle manufacturers, for example, are looking at new business models for end-of-life batteries, which are being used for energy storage. There is hope that the drive to recover valuable materials will be an impetus for producers and manufacturers to consider end-of-life. He argued that producers and manufacturers should be incentivised to look at resource availability rather than landfill diversion.
He used the example of a large coffee chain that recycles coffee cups because it recognises that being able to market coffee as being zero waste to landfill could boost sales. “There is a direct market mechanism that could incentivise this rather than it being a top-down policy approach.”
But Riley pointed to some of the limitations of such an approach, with the example of the difficulties faced by Closed Loop Recycling due to the falling price of virgin polymers: All of a sudden it could not sell its product.”
Beadle argued: “The danger [of such incentives] is that we will see some circular economy proposals from the EU presumably before the end of the year. One of the challenges we have got is that all the up-pipe stuff is incredibly difficult in a global market. The easy thing is the recycling rate.
“What we do not want is the public and private sectors sitting at the end of the pipe of a 70% recycling rate with no markets and a lot of materials cleverly designed to market for use, but not cleverly designed to ensure multiple use, disassembly or recycling.”
There was panel consensus that the industry needed to be better at lobbying Government departments, particularly DECC. One area in which the Government does not appear to be listening is in the possibilities for EfW to replace fossil fuels. Riley said the Government was using short-term response plants that are burning diesel to make up shortfalls in energy supplies.
“The problem with this country is we do not have an energy policy that marries up with the energy demand,” he said. “The advantage of an EfW plant is that it’s base load. Can waste supply enough energy to keep the lights on and stop our energy gap? No, it can’t.
“But what it can do is bring in, over relatively short periods of time, substantial amounts of base load. That is what DECC does not seem to be able to understand, where waste can play this role within energy policy.”
The consensus was that EfW could not be used for short-term energy generation because the start-up was too slow. But some of the newer technologies coming on-line that use syngas or liquid fuels could be used to access fast response markets.
Members of the panel
Robin Latchem, editor, MRW; Jim Clay, operations director, ESG; Chris Jonas, director of business development, Viridor; Kieron Parker, bid director, Shanks; Joanne Wood, senior business adviser, Monksleigh; Tom Anderson, business development manager, European Bioenergy Research Institute; Keith Riley, proprietor, Vismundi; David Beadle, ex-president, Chartered Institution of Wastes Management. Chindarat Taylor, director, Resource Efficiency Pathway, joined the debate by teleconference.
coming on-line that use syngas or liquid fuels could be used to access fast response markets.