UK waste sector market opportunities

© Ricardo plc 2013 1

Ricardo-AEA

© Ricardo plc 2013

RWM 2013: 10th to 12th September 2013 @ NEC

Dr Adam Read

Practice Director – Waste Management & Resource Efficiency

UK Waste Sector Market Opportunities


A personal welcome

• Prof. Adam Read

– Practice Director @ AEA for Waste Management & Resource Efficiency

– 19 years of operational expertise

– 90 consultants (UK)

– Former Local Authority Recycling Officer (RB Kensington & Chelsea)

– Former Academic & University Researcher


• Introduction

• Introducing Ricardo-AEA

• European Waste Policy

• UK Waste Policy

• Waste Market Opportunities

• Waste to Energy Opportunities

• UK Waste Infrastructure needs

• The Future?

• Question time

Presentation Overview


• i2i wanted a ‘Resource Efficiency & Waste

Management Market Opportunity’ report

• The report combines data, expertise and

research collated from leading experts in the

field, providing;

– A detailed overview of the UK waste

management sector

– Insights into future European waste policy

– Updates on UK waste policies

– Market opportunities in infrastructure,

transport, re-use, the circular economy

– Viewpoints from the public & private

sectors

• This presentation highlights these issues,

plus some of my own observations!

Introduction


Introducing Ricardo-AEA


My sponsor: www.ricardo-aea.com


Our Key Sectors


• Over 90 dedicated & technical staff

– Public sector policy development

– Strategy & options appraisal

– Waste modelling & LCA studies

– WRATE and carbon assessments

– Market research & analysis

– Service reviews, development & roll-out

– Procurement technical advisor / reviewer

– Bid manager / facilitator

– Technology assessment (all types)

– Permitting and EIA

– Technical due diligence / Expert witness

– Independent certification /

Commissioning

– Communications & Marketing

Our Waste Management Services


European Waste Policy


Policy Drivers

• Despite the economic downturn, the overall waste

management market has seen significant activity

• Driven by:

– the EU Directives (Landfill & Waste Framework)

– the Landfill Tax escalator

– rising values of materials

– recognition of the role of resource efficiency; and

the circular economy”

• Revised EU Waste Framework Directive

– brought the waste hierarchy to the forefront of

waste policy

– set a target for 50% preparation for re-use /

recycling HH waste for all Member States by 2020

• Landfill Directive

– all about diverting biodegradable

http://www.google.co.uk/url?sa=i&source=images&cd=&cad=rja&docid=R_enCBiok8VqkM&tbnid=TTUfnS0tYw4diM:&ved=0CAgQjRwwADiZAQ&url=http%3A%2F%2Fwww.scienceomega.com%2Farticle%2F1177%2Fprogress-on-the-horizon&ei=oOYkUp6gConZswa7v4GABQ&psig=AFQjCNG58s3Wo7VQALVI-ce9JDdxupZnxg&ust=1378236448263692


UK Waste Policy


• UK interpretation of the EC Directives is evidenced in national

waste strategies

– England, Scotland, Wales and Northern Ireland

• Each National Strategy

– outline long-term ambitions for waste

– supports separate collections

• Plus

– 3rd phase of Courtauld Commitment,

– WRAP Hospitality & Food Service Agreement

– Towards zero waste in different business sectors

– Code of Practice for materials recovery facilities

– End Destinations of Recycling Charter

UK Waste Policy


Waste Market Opportunities


• UK Trade & Investment Report

• The value of goods and services produced by the sector in

2010/11 was over £12 billion

• The sector employs about 150,000 people

– up 8.2% in the last 12 months

• The recycling sector generates more than £10bn in sales

– employs 30,000 people and generates £3bn in gross value added!!

– expected to expand, with the UK Treasury forecasting growth of 3.1%

for waste management by 2014

– 4% in recovery and recycling in 2013/14

• Expectation on the sector to make a major contribution to the

Government’s green growth agenda!

The UK Market


“We are likely to see waste management companies

consolidate over the coming years, there will be fewer

acquisitions and more emphasis on becoming a ‘good

collector’ or a ‘good processor’ rather than a ‘we can

provide any service you want’ type of approach”

UK Waste Market: Who are the players?


• Innovative collection systems to preserve the quality of materials

– organics, paper, plastics, glass, textiles etc.

• Obtaining value from recyclate

– reprocessing & remanufacturing

• Efficient treatment of residual waste as an energy source

– AD, EfW, ATT

• Residual waste refuse derived fuel (RDF) and solid recovered fuel

(SRF) production & export

– satisfy countries with excess thermal treatment capacity

– over 1.9 million tonnes are permitted for export by the Environment

Agency

• Delivery of shorter-term local authority contracts

– based on specific waste streams across municipal and commercial

sectors (WEEE)

Market Opportunities: Muncipal


• A shift from linear to circular

business models

• Repairing and refurbishing items for

re-use

• A circular economy has the potential

by 2020 to increase the UK‘s net

exports by more than £20bn

– and create 10,000 new jobs in the

recycling sector alone

– whilst businesses could reduce their

costs by more than £50bn/year!

Market Opportunities: Closed Loops


Market Opportunities: Recycling


• Vehicle innovations (design, operation etc.)

Market Opportunities: Collection


• Containerisation



• Communications



• £5bn worth of recyclables went overseas for energy recovery and

reprocessing last year…. Scope for UK investment?

It’s all about materials….


29

Good Quality?

Good quality? Bad quality?


• A key component in developing the UK market will be the MRF

protocol

– increasingly important in providing quality raw materials to industry

Market Opportunities: Quality Materials


Waste to Energy Market Opportunities


“There is a place for energy recovery in our portfolio of waste

treatment options. Gasification and Pyrolysis are simply two ways

of turning waste into energy”

• Investment in renewable energy and alternative technologies for the

treatment of waste has increased

– will continue to do so to meet EC / UK targets

• Green Investment Bank

– accelerating the UK’s transition to a green economy through

investment in the resource efficiency and waste management

– considering investing £50 million of its own debt financing in AD

projects

• Renewables Sector will need to be funded through equity markets

UK Waste Market: Waste to Energy


New EfW infrastructure coming on line

Source: Ricardo-AEA FALCON dynamic waste map & database


• The UK exported 890,000 tonnes

of refuse derived fuel and solid

recovered fuel (SRF/RDF) in 2012

• Gate fees for SRF reported to be

as low as Eu30/tonne in Northern

Europe

– Makes financial sense to export

waste

– Will continue to do so until attractive

price levels can be delivered by new

infrastructure

– Need to build new UK based

infrastructure

Market Opportunities: SRF/RDF


• Landfill mining

– recovering resources

– freeing-up ‘void’….

– generating energy

Market Opportunities: Disposal


Building solar parks closed landfill sites (Viridor have done this!)

Market Opportunities: Disposal


UK Waste Infrastructure Needs


• A major market opportunity is the

identification and development of

sorting and reprocessing facilities to

assist with ‘closing the loop’ in the UK

• Since last year’s RWM event

– 25 new waste processing facilities

have become operational

– Processing up to 2.2 million tpa of

residual, organic & recyclable

materials

– 4.9 million tpa of processing capacity

is under construction (see map)

• We remain under capacity in the UK

– So more facilities as we move

beyond EU targets!

UK Waste Market: Infrastructure

Source: Ricardo-AEA FALCON dynamic

waste map & database


The Future?


Investment opportunities ……


Investment opportunities …..

• Eco parks harnessing energy

– Manufacturers located around materials delivered, creating jobs, etc.


Investment Opportunities ….

• Recycling Rare Earth Elements (REE) Presents

Challenges

– there is no standard method of recycling rare earths

– research and investment needed!

• Plan B?

– groups are looking to find ways to avoid using REEs

– Automotive manufacturers are looking to break free

of their dependence on neodymium and lanthanum

– Philips and other electronics manufacturers are

looking for alternatives to yttrium and other rare

earths in LEDs and other products

• Collection & Segregation opportunities?

• Reprocessing needs?


• UK market remains buoyant = £12 billion per annum

– BUT additional £8 billion needed in new infrastructure to meet EU

targets by 2020!!

• Employment has risen by 8 in the last 12 months

• Key growth areas

– collections, recycling, reprocessing, energy recovery

– new technologies… ATT, Gasification, Pyrolysis etc.

• Critical sector to meeting UK Government’s renewable agenda

• Market is governed by EU / UK rules & regulations

• Need to understand local circumstances if you want to enter the

market

– FCC, Urbaser etc. have invested time, money & people!

– Good partners are key!!

Looking Forward


• My team are here to help

• Please come and share your opinions …..

Visit us on Stand 06M38


Good Morning!


• I am here all conference

– come and see me….

• Dr Adam Read

• Global Practice Director

• Waste Management & Resource

Efficiency

• Ricardo-AEA

• 07968 707 239

• [email protected]

• www.ricardo-aea.com

The last slide … I promise!

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UK waste sector market opportunities