A new report by SUEZ estimates that bringing Energy-from-Waste into the UK Emissions Trading Scheme will increase costs by around 50%, with gate fees set to rise by approximately £48 per tonne.
However, the report also found that ‘significant cost increases are not an inevitability’. The analysis found that investing in waste minimisation, reuse and recycling services at both kerbside and HWRCs will avoid ETS costs, potentially without impacting overall service costs.
SUEZ recycling and recovery UK commissioned the report, which was authored by consultancy Ceres Waste, Renewables & Environment.
Energy-from-Waste (EfW) will join the UK Emissions Trading Scheme (ETS) from 2028.
The report found that while an increase in costs will affect all customers of EfW facilities, the potential impact on local government budgets is ‘significant’ as local authorities provide around three-quarters of waste treated via energy recovery.
As part of the report, Ceres evaluated services and activities that could be deployed to reduce ETS costs by removing fossil carbon-rich materials, such as plastics, from the waste stream.
Its findings are based on SUEZ’s data set on waste generated by UK homes and businesses over the past eight years and publicly available data.
The expansion of the ETS to include EfW represents a generational policy shift – together with reforms to recycling policy, it will transform how we manage our waste here in the UK.
The report found that councils with comprehensive recycling services should focus on less collected fossil carbon-intensive materials, such as electricals and nappies, to reduce their ETS bill.
For local authorities with ‘inherent difficulties in increasing recycling at the kerbside’, secondary sorting, although less cost-effective, still offers scope to reduce ETS costs, the report says.
As final details of the UK ETS scheme are confirmed, the report also called for policymakers to recognise the limitations some authorities face in improving recycling rates and ensure the ‘costs of ETS do not fall hardest on those least able to mitigate them’.
The report also proposed a zero rate for waste that must be treated via energy recovery to protect the environment. For example, soft furnishings that contain persistent organic pollutants, and for EPR (extended producer responsibility) funding to lead to real-term increases in local authority waste management budgets to support investment in recycling.
Commenting on the report, John Scanlon, Chief Executive Officer of SUEZ recycling and recovery UK, said: “The expansion of the ETS to include EfW represents a generational policy shift – together with reforms to recycling policy, it will transform how we manage our waste here in the UK.
“At the same time, policy makers have more work to do to ensure bringing EfW into the ETS achieves the overall goal of reducing the carbon impact of managing waste.
“Protections must be put in place before the scheme is implemented in 2028 to prevent waste being diverted to potentially cheaper but equally carbon-intensive disposal routes that fall outside of the scheme, such as landfill or waste tourism to European energy recovery facilities.”