Seventh Carbon Budget proposes UK target of 68 per cent recycling rate by 2035

The Climate Change Committee (CCC) has issued a stark warning that any new energy from waste (EfW) plants must establish viable routes to carbon capture and storage (CCS) or risk becoming stranded assets, according to the newly published Seventh Carbon Budget.

This represents one of several stringent new policy recommendations for the waste sector, which currently accounts for six per cent of UK emissions (24.9 MtCO2e). The budget's Balanced Pathway requires waste emissions to fall by 67 per cent to 8.3 MtCO2e by 2040, with targeted interventions across recycling, landfill, and energy recovery systems.

Recycling ambitions raised

Stalled progress in waste sector decarbonisation has prompted the CCC to push for more ambitious recycling rates. The budget notes that UK recycling rates have plateaued since 2010 and mandates an increase to 68 per cent by 2035, with household recycling rising from 45 per cent to 57 per cent and non-household waste recycling from 49 per cent to 74 per cent.

"Planned policies are unlikely to achieve this," the CCC warns, calling for greater clarity on government plans around recycling, reuse, and resource efficiency.

The budget takes particular aim at inconsistent collection systems, proposing mandated harmonised collection across local authorities, including separate food waste collections nationwide. This approach highlights the success already achieved in Wales, which has achieved 57 per cent household recycling.

Carbon capture essential for EfW viability

One of the most significant features of the Seventh Carbon Budget is the strengthened position on energy from waste (EfW) facilities, which (after landfill) the report says has become the second-largest source of waste sector emissions over the past decade.

The CCC now explicitly warns that new EfW plants should only be licensed if a viable route to connecting to Carbon Capture and Storage (CCS) can be established. "Continuing to build EfW without access may lead to stranded assets," the budget states.

By 2045, all EfW plants should be equipped with CCS technology, capturing 90 per cent of CO2 emissions until 2040 and 95 per cent thereafter. The roll-out of EfW with CCS is projected to begin in 2028, with two plants in the HyNet cluster expected to come online.

This presents significant practical challenges, as only about 17 per cent of existing EfW plants are located near industrial clusters where CCS infrastructure is planned. The remaining 83 per cent would require additional pipework construction or non-pipeline transport options.

The budget acknowledges that while CCS is central to the waste sector's decarbonisation pathway, the technology faces implementation challenges. The report notes that several CCUS projects are in development across the UK, but their deployment will depend on overcoming hurdles related to infrastructure development, cost, and public acceptance.

Landfill elimination accelerated

The budget proposes a two-phase approach to landfill elimination: near elimination of biodegradable waste sent to landfill from 2028, followed by the near elimination of all waste sent to landfill from 2045.

This represents a marked acceleration from previous targets and closes loopholes that previously permitted limited landfilling of inert materials. The timeline for total landfill elimination in 2045 aligns with the date when CCS is expected to be installed at most EfW plants.

Even with these elimination targets, legacy emissions from existing landfill sites remain a concern. The budget calls for improving landfill methane capture rates to 80 per cent by 2050 to address these emissions.

Circular economy moves to centre stage

The Seventh Carbon Budget elevates circular economy principles from peripheral considerations to central components of waste policy. It advocates for material-specific consumption reductions, expanded producer responsibility, and "right-to-repair" legislation.

Unlike previous budgets, which focused primarily on downstream waste management, the Seventh Budget prioritises upstream interventions such as product design standards and digital material passports to track recyclability.

The CCC has also adjusted its economic approach, internalising the externalities of virgin material use to make recycling economically preferable through carbon pricing and material taxes.

The budget emphasises that this systemic approach to waste reduction represents a significant shift from incremental improvements toward transformative change in how materials are produced, used, and disposed of throughout the economy.

Wastewater and technological innovation

The budget highlights the need for investment in the wastewater sector to roll out technologies such as advanced anaerobic digestion to both municipal and industrial wastewater treatment plants.

Digital innovations feature prominently, with recommendations for enhanced monitoring, real-time control systems, and "digital twins" – virtual models of treatment plants based on real-time data that can reduce process emissions through optimisation.

Importantly, the CCC notes that improvements in wastewater treatment can deliver multiple benefits, including preventing sewage spills and improving water quality in UK rivers.

Implementation challenges and infrastructure dependencies

The CCC’s budget projects that delivering the Balanced Pathway for waste will result in a net cost to the economy compared to the baseline, with the majority of expenditure coming from CCS installations at EfW plants, plus additional costs for recycling infrastructure and wastewater treatment improvements.

The Seventh Carbon Budget identifies two spikes of high additional capital expenditure in the pathway, specifically caused by landfill bans in 2028 and 2045. According to the CCC, these bans increase the waste sent to EfW plants, particularly in 2028 when emissions from incineration are due to be included in the UK Emissions Trading Scheme. These financial pressures could pose challenges for local authorities, who are responsible for household waste collections and some commercial waste management.

"Local authorities will need funding and policy certainty to deliver improved recycling and manage additional costs from using CCS with EfW," notes the CCC acknowledging the financial constraints inevitably faced by the public sector.

The Seventh Carbon Budget recognises that waste sector decarbonisation is heavily contingent on establishing large-scale CO2 transport and storage infrastructure. Without this infrastructure backbone, the waste policies outlined in the budget may not deliver their intended emissions reductions.

This infrastructure dependence creates a circular challenge – CCS is essential for both waste sector decarbonisation and engineered removals, which according to the budget are projected to play a significant role in meeting carbon targets, but implementation timelines remain uncertain.

The budget also acknowledges that public acceptance issues could further delay progress, as opposition to infrastructure development has affected other climate-related projects in the past.

Role of engineered removals in waste sector

The Seventh Carbon Budget outlines a significant role for engineered greenhouse gas removals in the waste sector, with particular attention to the potential of bioenergy with carbon capture and storage (BECCS).

The document notes that burning biodegradable waste in an EfW plant fitted with CCS delivers CO2 removals, which could provide approximately 5 MtCO2e of removals by 2050. These removals could offset residual emissions in the waste sector.

The CCC calls for a "common sustainability framework for biomass, along with robust procedures for monitoring, reporting, and verification," emphasising the need to prioritise domestic supply and provide clarity on which feedstocks are provably sustainable.

The budget acknowledges that engineered removals technologies face significant implementation challenges. According to the supporting document on Direct Air Carbon Capture Storage, no engineered removals have been recorded at commercial scale in the UK to date, with only small-scale testing currently underway. Several pilot plants are being developed, including projects with capacities ranging from 60 to 250 tonnes of CO2 per year, with some future plans to scale to 1.5 MtCO2e.

The CCC notes that the UK has significant geological storage capacity for captured CO2, but deployment depends on overcoming substantial infrastructure challenges. The budget indicates that carbon capture technologies cannot be deployed at scale until CCS infrastructure is in place, which is unlikely before 2030.

Emissions reduction will be 'an uphill battle'

Responses to the Seventh Carbon Budget have highlighted the opportunities for the UK green sector, with Bill Esterson MP, Chair of the ESNZ Committee, explaining: “The Climate Change Committee’s Seventh Carbon Budget makes clear the huge prize to be won from a keen focus on the clean energy transition.

“To win the gains of cheaper energy from low carbon technologies, we need to capture the public’s imagination – to incentivise and win them over to the clear advantages in the clean energy sector, that will bring costs down significantly.”

Charlotte Rule, Head of Climate and Energy Policy at the Environmental Services Association (ESA), added: "Achieving sectoral net-zero, as the CCC recognises, will require a step-change in recycling performance to drive down waste volumes and remove plastics from the residual waste stream.

"Without dramatic improvements to recycling performance and residual waste reduction, any other measures we take to reduce emissions associated with waste will be fighting an uphill battle."

However, reactors also warn that without further government action and investment, this opportunity may be lost.

Dr Amy McDonnell, Co-Director of environmental campaign group Zero Hour, commented: “The fourth and fifth carbon budgets are so weak that the Government only needs to cut emissions by an average of just one per cent per year between 2023 and 2032. This lack of ambition is why we keep seeing failure after failure on climate and nature policy.

“Therefore, the Government must not only look ahead to carbon budget seven—but take immediate and decisive emergency action now.”

Toby Perkins MP, Environmental Audit Committee Chair, added that the government will have a chance to act on the CCC recommendations this year: “In the autumn Ministers will ask Parliament to vote on a legally binding figure for the UK’s emissions in the period from 2038 to 2042. The challenge for Government will be to explain to both Houses, in advance of these decisions, the measures it plans to put in place to make sure that this target can be met.”

The lack of focus given to reuse and repair was also noted. John Scanlon, CEO of SUEZ, suggested: "Embedding reuse and repair clearly into the budget's framework, with real targets and incentives, will drive the circular economy necessary to reaching Net Zero goals.

"As a society we can’t reduce carbon emissions if we continue with the linear economy habit of transforming valuable resources into waste and recycling. We have to aim higher up the waste hierarchy than that and look to re-use and repair. Statutory support for this approach would be a huge step forward.”

Additionally, Paul Mines, Chair of the Bio-based and Biodegradable Industries Association (BBIA), points out the Budget's failure to acknowledge the role of defossilisation: "The UK’s 7th Carbon Budget misses the opportunity to lay out a path to defossilise the chemicals industry to meet our climate commitments and build a truly circular, low-carbon economy. The sector remains heavily reliant on fossil carbon not only as an energy source but also as a feedstock, despite viable bio-based alternatives."