Comment

Insufficient AD capacity for mandatory food waste collections

Ben Brown, Technical Director at Walker Resource Management, a specialist environmental consultancy, outlines the challenges involved in meeting the government’s mandatory food waste collection requirement by April 2025.

In 2018, the UK Government released the Resources and Waste Strategy for England, a landmark strategy which aims to transform approaches to waste and resource management as part of the Government’s wider 25-year Environmental Plan and Environment Act (2021). The strategy significantly moved the importance of biowaste recycling up the waste policy agenda as it includes a mandatory requirement for all local authorities to collect and recycle food waste from domestic properties by April 2025.

Ben BrownScaling up food waste collections

The Resource and Waste Strategy household food waste recycling requirement is a significant policy requirement as only c.50 per cent of local authorities in England presently offer a source-segregated household food waste recycling service. This means there are still some 160 of the 320 district, metropolitan borough, London borough and unitary authorities who need to design, develop, and mobilise new food waste collection services by 2025. Furthermore, there are 45 additional authorities who presently collect co-mingled organic waste, where food waste is mixed with garden waste for collection, who may be required to redesign their services and re-procure treatment services.

This scale of service development and re-design represents one of the most significant expansions of local authority waste collection services over the last decade and a half: since kerbside dry recycling services were rolled out at scale.

Supply and demand

The increase in the quantum of food waste entering the market over the next two years will provide challenges and opportunities for the sector. At the time of reporting, the WRM Food Waste Market Report identified that the current national AD surplus capacity was commensurate with projected increases in food waste yields. This national picture is misleading at a regional level, where several regions have an oversupply of capacity to meet regional demand, with food waste imports from further afield meeting this imbalance. Other regions have a significant deficit of treatment capacity and currently export a large proportion of collected food waste.

As new developments are built to meet regional demand, exports are projected to decrease, providing market challenges for operators within regions with a surplus of treatment capacity, and an increase in reliance upon commercial and industrial feedstock supplies.

Food waste treatment capacity

The development (and procurement) of new food waste treatment capacity faces challenges in meeting the now-delayed implementation date of 2025. The detail within the Public Contract Regulations (2015) defines procurement routes (open, restricted, competitive dialogue, frameworks) which shape the ways in which authorities can engage the market and procure services. The different routes have different durations for the procurement process ranging from 3-18 months. An even longer duration is involved in those circumstances where the contracting authority chooses to finance new developments where, for example, treatment capacity is absent or limited so as to provide a barrier to competition.

In such circumstances, as exemplified within our work on the regional imbalance of treatment capacity, the procurement and development timescale has already expired ahead of a 2025 implementation date. Development timescales continue to be hampered by supply chain delays and the continued issues involved with obtaining the necessary permissions and consents to operate, putting future developments at risk of missing commissioning deadlines or milestones for accessing financial incentives.

Over recent years, we have seen AD operators being awarded local authority contracts at near and below zero gate fee rates. This has been particularly evident in those regions with a surplus of treatment capacity, where legacy incentive schemes provide a strong competitive advantage over new market entrants.

Continuing variability

The regional variability in gate fees is expected to continue beyond the implementation of the consistency in collections strategy through a combination of market factors such as regional treatment capacity, contract mechanism, and - significantly - the incentive scheme secured, with a particular note on the current longevity of the green gas support scheme, currently due to expire in November 2025.