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Waste: Ways out of the mess
A paper by Richard D North[1]
Version: 230204
Contents:
Conclusions
Introduction
Prejudices about waste: abstinence vs solutions
The "Waste Hierarchy": preferring the costly and inconvenient
Waste: raw material or insoluble problem?
Life Cycle Analysis: widening the issues
Can waste be virtuous?
Waste: political realities
Waste politics: At a local level, NIMBY politics
Waste politics: at EU level
Waste politics: at UK level
Waste economics and policy
Where are we right now?
A note on the waste industry: where the buck stops
A note on the funding of this paper
Conclusions:
Here is a foretaste of the conclusions this paper will reach.
1) Waste minimisation, reuse, recycling, composting, landfill and
incineration can all be good – and all bad – according
to circumstance. The “waste miles” involved may be the
biggest deal with any of them.
2) The “Waste Hierarchy” ignores the above truth, and
attempts to prioritise ecological waste options, technology by technology.
If anything – it gets them back to front. However, it does
effectively rank waste options by their cost and inconvenience.
So (by mistake) it reminds us that cheapness and convenience may
be a rather good guide to waste options, or at least that using
cheapness and convenience as our guides may not be harmful.
3) The UK planning system is so "democratic", it makes
good waste policy difficult.
4) It would be nice if the EU did not regulate every last detail
of waste management (especially as they've bought into the Waste
Hierarchy, so they are wrong about much of it). But they will continue
to try to. This may not matter: lots of experiments with different
options may be useful.
5) The EU may not be bad on economically-efficient incentives to
better behaviour: for once it might buy an “Anglo-Saxon”
argument.
6) Domestic householders should be charged for waste disposal as
they are for waste water disposal. This is as near to "Polluter
Pays" as we need to get. “Metering” may not be a
good idea.
8) The waste industry is one of the few elements in the story with
the society’s environmental and economic well-being at heart.
Introduction
Waste: delicious dilemmas.
A handful of examples:
1 The UK taxes landfill - but that hasn’t much reduced the
flow of troublesome domestic wastes to holes in the ground.[2]
2 In the US, recycling lead is one of the few activities threatening
to raise the level of the heavy metal found in children’s blood,
after years of decline.[3]
3 In the US, charging householders for waste disposal on the basis
of the amount they throw out has seemed to lead to a good deal of
fly-tipping.[4] In Switzerland it works a treat.[5]
4 Ecologically-alert Denmark sends the waste products of its large
incineration programme for landfilling in Norway (a practice which
abuses the Green’s cherished principle that countries should
look after their own waste, but which seems to work).[6]
5 Schemes to force US householders to put out less waste (or charge
them) tend to result in them putting out very little less waste.
However, they compact it rather more - a job easily done by the
lorries the councils send round. [7]
This little list reminds us that unintended consequences are the
policy-maker’s first birthright. On the other hand, the list
should not lull us into a comfortable dilemma-ridden sense that
nothing can be done, or that we can avoid making decisions. Waste
disposal is one of the few problems on which voters exert real influence,
and do it through authorities – their districts and councils
– close to them.
This is a paper about “household and municipal waste”:
the stuff the binmen pick up from households, retailers and offices.
This is not the biggest or worst of the waste issues society faces,
but it is the most visible. Also, it is both the bedrock of the
waste industry, and the location of some of the most important planning
and other decisions politicians have to make – and the answers
to which determine industrial waste policy.[8]
There has to be waste policy. Waste is not something the market
can handle by itself. The market is good at producing things people
want - it is not so good at valuing things people do not want. Arguably,
waste is one big “externality” (those social and environmental
costs that the market does not capture by itself). It certainly
involves managing – and costing - many externalities (many
sorts of pollution, including global warming, and all sorts of nuisances
such as noise).
It happens that for about twenty-five years, I have reported on
the waste industry – and have always enjoyed its problems.
I have always been fascinated by the people who undertake this difficult
and unpopular work, and have admired most of them a good deal.
Contrariwise, I have disliked the Green tendency to stigmatise
the industry.
So this paper by someone who loves the market, and has an affectionate
interest in the waste industry, is about seeing how we can better
describe the “problem” of waste, and develop rules which
handle it by harnessing the market’s energy rather than frustrating
it. And of course, one wants a healthy environment as well.
But Green opinion is a not good guide to waste policy, because
all its prejudices tend to exaggerate the problem of waste, and
its intractability. And its prejudices also lead it to dogmatic
preferences between different waste options.
For all that, Green orthodoxies are at the heart of much of the
emerging EU policy on waste, and that is almost as much the reality
against which UK policymakers must work as is the fact that - one
way or another - the nation's bins must be emptied every week.
Prejudices about waste: abstinence vs solutions
More than any other of the green issues, waste comes laden down
with prejudices. More even than driving SUVs, travelling to exotic
destinations in airplanes, or eating animals from factory sheds,
throwing things away makes nice people feel guilty. There is something
in our genes almost, something learned at our mother’s knee
- our grandmother’s knee even more - which says, “Waste
not, want not” as we bin things. We say, with a sigh, “Ah
well, out of sight, out of mind”, but even as we say it we
know that we have avoided the proper awareness of the consequences
of what we do.
This prejudice runs deeper than the problem of what, actually,
we should to do with things once we’ve consumed them. It is
about the whole business of consumption. If throwing things away
is bad, the prejudice goes, so too is the profligacy that inevitably
gives rise to waste. The Green view is that much of what we have
- what we buy and cause to be made - is not needed and ought not
to be wanted.
Other issues mirror this sort of logic. All energy is more or
less polluting, so we ought to stay at home and wear an extra sweater.
All industrial plants disgorge more or less damaging emissions,
so we should eschew their products. The point is: the Green argument
says that technical fixes (“end of pipe” solutions) are
at best a second best: the best-best is self-denial.
As we consider what do about the mountains of waste we throw into
the huge holes quarry firms have dug out so we can have roads and
houses, we should bear in mind this prejudice. It matters because
the waste issue is above all an area in which the Green campaigners
would far prefer that there was no solution but abstinence.
The "Waste Hierarchy": preferring the costly and inconvenient.
This helps explain the idea of a “waste hierarchy” which
has guided (plagued, one might say) the policy debate. This ordering
of preference has two versions.[9] One suggests that we should first
minimise waste (and the higher up the production chain the better)
and then move to recycling and only then move on to disposal. There
is a second, more detailed, version of the waste hierarchy that
prioritises the various technologies that can be deployed. It usually
runs, in order of preference: recycle, treat, compost, incinerate,
landfill. Few people dispute these hierarchies in public. In private,
there is hot debate between those that see incineration and landfill
as capable of being a form of recycling (because they can produce
either useful energy or materials or both) and those who see them
as dumping by another name. The next section deals with this issue.
If there were an anti-consumerist logic behind these hierarchies
(rather than a purely environmental one), it could hardly be better-served.
Landfilling is very cheap. Incineration is relatively expensive.[10]
All the others are either yet more expensive or inconvenient, or
both. That’s to say: kill or punish landfill, and one has a
powerful device for making consumer society much more difficult
or expensive. By killing or punishing incineration, one can make
life pretty expensive or inconvenient. By insisting on composting
or recycling (let alone reuse) one is forcing yet further cost or
nuisance on people. (We can include composting as an expensive technology
partly because only a sophisticated version will do, and because
it leaves a goodly fraction of waste to be handled by other means.)
As we shall see, the Waste Hierarchies are wrong in their ecological
prioritising, but they are a pretty accurate ranking of the cost
or inconvenience of the various waste technologies. The Green argument
suggests that cheap solutions are careless ones. The "consumerist"
is inclined – contrariwise - to wonder if the economic cost
of a solution might not capture some of its ecological cost too
(perhaps by pricing the energy, labour and materials involved).
Anyway, the waste hierarchy serves the anti-consumerist doctrine
rather well. It legitimises the idea of penalising cheap and convenient
waste options so that they are as expensive and inconvenient as
“naturally” awkward ones.
Waste: raw material or insoluble problem?
Anything which is recycled was never really waste. What one person
discards, but another can use, was never really waste. It was a
raw material. Again and again, those who handle waste wish it was
seen as a resource for someone else in the chain. Oddly, the Greens,
who are inclined to want us to see the value in waste, nevertheless
are reluctant to accept that it is a resource. They are sufficiently
in love with abstinence to wish that we had never consumed, and
certainly never discarded, anything. They want it to stay stigmatised,
even as the rest of us might seek to see it more positively as a
raw material.
Hardly surprisingly, a huge amount of policy-makers’ time
is spent debating this issue.[11]
The Greens want waste to maintain its status as a “problem”,
though they also want to "close the loop". Their case
is that almost everything we do is environmentally bad, and even
recycling is only less-bad than not consuming in the first place.
The upshot is that the waste disposal industry wants a wide definition
of "recycling", and the Greens want a very narrow one.
Thus, in a classic case, the “Ghost Ships” which were
towed to the UK for scrapping were (in Green eyes) “toxic”
and an ecological disaster waiting to happen. For the shipyard,
they were a source material coming in for recycling and such waste
problems as they gave rise to (asbestos, for instance) were small
beer compared with the waste which the UK already has to dispose
of.
Similarly, plastic in packaging, for instance, is frowned-upon
by Greens as troublesome waste. In Green eyes, plastic can be made
a little more forgivable if it is collected and treated so as to
become a usable plastic again. But a fan of incineration might see
it as pre-used fuel for a power-generating incinerator, and as such
rather better than ordinary fuel since it has fulfilled an additional
human purpose. So reviled is this material that the EU penalises
its use as fuel in incinerators (more of which below).[12]
The plastics case nicely shows us that the Greens insist that
recycling consists in producing a material as much like the original
product as possible. The waste industry is more inclined to say
that getting any sort of good value out of a material is good enough.
We can tackle this in another way: The Greens understate the environmental
downsides of their beloved recycling, provided the material is for
reuse. And they exaggerate the environmental downside of the many
of the waste industry’s practices, even where they capture
quite a lot value.
Life Cycle Analysis: widening the issues
In the UK, it happens that we have always had - and in some places
still have - large holes in the kind of geology into which it is
fairly easy to put things without much risk of their leaking nastily
into their surroundings. (It is surprising, granted how little containment
mattered to early landfillers, how few landfills have caused leakage
problems.) There is then a separate issue about the emissions of
methane that any rotting material will produce. Methane is a greenhouse
gas, so it is a bad idea to release it to the atmosphere. There
are two solutions to this problem: capture the methane and be glad
it is wonderfully efficient fuel[13], or not put rottable material
in the landfill in the first place. After all, it can be composted
separately, and the methane produced can be captured at that stage.
It is a peculiarity of recent UK environment policy that we have
taxed landfill and produced the effect that putrescible (arguably
problematic) material still went to landfill but inert (rather benign)
material stopped being sent. This latter was a pity since such stuff
was needed to help make landfill work well. The latter effect was
put right by re-jigging the tax. The former, more intractable issue
will be tackled, it is hoped, by increasing the tax (and doing so
well beyond the level needed to capture the environmental externalities.)[14]
But the problem with landfill may not really be the one that is
so often advertised by the Greens. We have fewer holes than we used
to, and we now landfill waste further and further away from where
it’s produced. Thus, Brighton’s polite south coast “arisings”
are now shipped to a landfill amongst the gritty northern realities
of Stoke on Trent. Those “trash miles” would need to be
factored into any serious account of the ecological effect of Brighton’s
waste disposal.
We will come back to this, the heart of waste and any other environment
issues. We need “life cycle analysis” to tell us how to
judge the real impact of this or that human activity. The point
is that one can’t usefully pick on small bits of the process
involved.[15] So the delivery of waste to the hole in the ground
may matter as much as the more obvious emissions from the waste
once it’s there. The difficulty, of course, is that totting
up these impacts is a lot harder than running a company account
through a spreadsheet. And what is worse, knowing the up- and down-sides
of one route of disposal gets one nowhere until one has done the
same calculation for any alternatives.
Suppose that one now considers incineration. Its supporters remark
that its gaseous emissions are simply no problem, and haven’t
been for 20 years since regulators have tightened up controls, following
vast improvements in the technical ease of controlling the problem.
Never mind the rhetoric of the greens or the politicians of every
stamp - nor even the industry. Listen to the UK regulator, the Environment
Agency (whatever the predilections of its politically-correct bosses):
its website declares its acceptance that the risks are acceptable.[16]
By the way, there is evidence that of the CO2 emitted by waste incinerators,
only about 13% is “net”, or “additional” to
what would have been produced in the absence of incineration.[17]
Plant a few trees, and this “surplus” could be mopped
up. There are issues to do with the 10 percent of the original waste
which remains in the form of flue-gas residues (from what would
have gone up the chimney) and the non-combustible slags and ashes
which remain in the grate, as it were, after burning. These contain
heavy metals and require landfilling. So the issue of incineration
is largely a landfilling issue.
Since neither landfilling nor incineration has a fraction of the
problems normally ascribed to them, but neither is problem-free,
why not suppose that recycling would be preferable to either?
Well, the main reason is that recycling tends to involve the energy-intensive
treatment of low-value materials with the hope of producing a rather
lower-value material than we started with. So it’s often a
question of burning lots of fuel to get a poor product. Sometimes
the equations work out not badly, or very well. But that’s
rare, and on the whole the best recycling is the sort which aims
low.
This is not to dismiss recycling. It happens that the paper and
glass industries both need recycled material as they produce “virgin”
material. Often, industrial sources (factories, supermarkets even)
are excellent sources of material which can be cheaply shipped to
recycling plants where commercially useful products can be made
from them. Often, industrial plants can be designed so as to produce
“waste” streams which can be good raw materials for other
processes, and goods - cars, for instance - can be produced so as
to be more easily recyclable.
But the last case is an interesting one: some of the cars now
produced are less easily recycled than previous models. But this
is because they are made of materials which make them light (yet
strong) enough to save lots of energy in their use. If the recycling
foregone in this change saved less (or cost more) energy than the
lightened vehicle, then the deal is a good one, whatever the verities.
Similar cases can be made about reuse. New cars are less polluting
in nearly every way than old ones, so any drift towards changing
cars has environmental benefits, though any drift toward larger
engines can undo the energy efficiency which is now possible. One
might say this more cautiously if one factored in the environmental
costs of earning the money to pay for the trade-in. Ditto, fridges,
deep-freezes, central heating systems and even houses.
So amongst the first lessons for a waste policy-maker is the hardest
one of all: there are no simple guides to virtue here. The trick
is to think through the real effects - the real costs and benefits
- of a waste policy, not to hang one’s hat on a formula or
a hierarchy.
Can waste be virtuous?
If we recast landfill as a sort of creative geology and incinerators
as biomass energy generators (rather like a wood-burning stove)
then we can suggest that the “bottom end” of the conventional
hierarchy can be virtuous. Landfill takes the bits of the earth’s
crust we have quarried for materials we want for roads and buildings,
and it refills these holes with materials whose best use may be
as hole-filling. Incinerators take materials of small use, and discover
their value as sources of heat. In the former case, we can be positively
glad that much our waste material is inert - and then consider whether
we should be capturing the methane from the rottable fraction of
our landfilled waste. Methane is a potent Greenhouse gas, if released
unburnt. But when burned, it is transmogrified into one of the least
global-warming fossil energy sources.
In the case of incineration, we can be glad that much of our “waste”
in burnable - and consider whether the non-burnable part is really
such a problem in landfill, or might be recoverable in other ways.
So the core of these cases is that landfill and incineration both
have the potential – like composting and recycling - to find
value in what had previously been considered waste of no, or negative,
value.
Waste: political realities
Waste politics: At a local level, NIMBY politics
Waste is handled by the waste industry, which is contracted to
do the work by Local Authorities, on behalf of their voters. Local
Authorities are also the main location of the planning system, on
behalf of their voters. We have no idea whether voters will pay
for expensive waste solutions (they’ve never really been asked).
But we do know that they hate almost everything the waste industry
wants to do. This is a real bind.
All we know about the future of waste policy is that “reforming”
it will involve finding about 2000 new sites. These may be incinerators,
landfills, composting yards or sheds, or treatment (recycling) plants
- listed here in order of the political objection likely to each
application.
We might bear in mind that the most serious goal of most policy-makers
will be the global warming implications of waste policy. Rightly
or wrongly, they have the Greenhouse at the front of their minds.
But it is nuisance and toxicity – the latter often more imagined
than real – that worries the voters. This is, by the way, a
problem for Greens: they agree that Global warming is or ought to
be their number one issue, but they are stuck with having sold recycling
(which may be bad for the Greenhouse) as a core value.
So one of the peculiarities (and problems) facing waste policy-makers
is the opposition of the very people who are throwing away the waste.
Our planning process is extraordinarily open to the objections
of affected citizens. So NIMBY (“not in my backyard”)
is a powerful force. Most waste planning applications will be discussed
and delayed for years and even decades whilst local voices are attended
to.
The opposition to landfill and incineration is vociferous and
forceful and usually expresses itself at the point at which the
industry seeks planning permissions to fill a quarry or build a
smokestack. Recycling – composting, and so on - only looks
like a solution to this problem. People are likely to object to
those facilities too.
Of course, even energetic recycling programmes will leave plenty
of waste still to be buried or burnt, or composted.
The dislike of voters for almost all its technologies will leave
the waste industry in the position it has always occupied. It is
in the planning permission business. Like the house-building trade,
landfillers in particular must build a stock of land, whose location
and geology will of course matter a good deal. But the physical
land will be no use if the owner hasn’t managed the political
situation well, and got the permissions and permits which allow
him to be in business. Firms offering incineration, and to a lesser
extent people offering composting, have the problem that very high-profile
campaigns will be waged against them, with groups like Greenpeace
operating both nationally and locally against their plans.
This is one of the many points where “environmentalism”
works against good environmental policy.
Our core problem is to find a place in the system where the economics
of different waste disposal options is married up to their ecological
efficacy, but also where decisions can happen. One obvious answer
is to see Local Authorities and their voters as this pinch-point.
Local voters are crucial in deciding what options can happen on
the ground – it would be a good idea for them to sense sharply
the costs of bad waste decisions.
Tantalisingly, we are nearly there already. Local Authorities
charge their voters for waste disposal. But the price is low. And
worse, it is buried within general council charges.
Perhaps local voters should pay a direct charge for waste disposal.
And then – and this is much more controversial – perhaps
each voter should pay according to how much their waste disposal
costs.
Wouldn’t that impose a proper economic and ecological discipline?
We’ll return to this.
Waste politics: at EU level
The EU believes in treating wastes. It has always been more interested
in regulation than in voluntary approaches.[18] It has also, and
this is important, been keen on dictating precise outcomes (“x”
waste should go to “y” disposal option with “z”
standards applied). In consequence, it has been less interested
in a light touch which sets broad targets.
But the real problem is this. We cannot readily predict which
waste options work in any particular situation, and are working
to improve the environmental outcomes from any and all options.
So we need to lay down the broad outlines of what we seek, and then
allow many experiments in how to achieve them.
There is a parallel issue. Societies everywhere are trying to
work out how to penalise “bad” waste options and incentivise
“good” ones. These “fiscal instruments” of course
all depend on intervention in the market.
Roughly speaking, the biggest divide is between the Germanic tendency
and the Anglo-Saxon. The Germans believe that every aspect of waste
disposal should be regulated, and that it is very reasonable to
tell producers and consumers in great detail what they should do
with their waste. They are then happy to impose quite high costs
on consumers to make particular waste outcomes come about. They
have, for instance, imposed a packaging recycling system which is
widely regarded as clumsy, expensive and ecologically counterproductive.
The British (and the US) believe that the least intervention by
regulation or penalty (or incentive), the better. Their approach
is to try to find the right points of leverage, the points where
the least intervention produces the greatest desired affect. This
is sometimes described as trying to find “Silver Bullet”
intervention.
There is a degree of convergence here: the Germans do believe
in sending price signals, and the British do believe that fiscal
measures do at root depend on regulations (even tradable permits
– a favoured option – depend on government selling “quotas”).
Besides, we could argue that the Germans are at least exploring
what works, whilst it took the British nearly ten years longer to
get seriously interested in recycling. Even now, we are reluctant.
The British position may be justified, but it was hardly innovative.
In brief, the EU is at the moment sending signals that it is quite
interested in a lighter touch.[19] So whilst the EU has invested
too much in the Waste Hierarchy, and in precise regulation, there
are indications that it is open to Anglo-Saxon arguments about how
to use economic sticks and carrots. And there are signs, too, that
the EU may be less in thrall now to the Waste Hierarchy than it
once was: it is more open to the idea of recovering any sort of
value from waste, rather than thinking in terms of high quality
materials recovery alone.[20]
Waste politics: at UK level
The past twenty years have seen a gradual capitulation by British
regulators. Successive recent secretaries of state and green ministers
have “gone native”.[21] They have succumbed to the Green
argument. This is not merely a matter of expediency, but an actual
change of heart. In very recent years, these ministers have appointed
increasingly “Green”-minded people to be the public face
of, for instance, the Environment Agency.[22] This means that a
broadly “continental” approach has been adopted in the
higher reaches of British official environmental thinking, and even
its policy. It has become anti-whaling, anti-nuclear, anti-incineration,
anti-landfill.
Partly, this is a response to a capitulation to EU thinking. During
the 80s, the UK faced a fairly serious diplomatic problem because
of its insistence that "dilute and disperse" (landfilling,
dumping at sea) were often very acceptable environmental solutions
to waste. The Continentals and Greens everywhere thought this was
plain offensive. By about 1988, the UK gave in, though many of its
best environmental regulators persisted in believing that they were
right.
In this most technically and politically tricky area, the Cabinet
Office - Mr Blair’s own thinktank - produced a document, “Waste
Not, Want Not”.[23] This was presumably a response to a Downing
Street perception that the environmental establishment within Whitehall
wasn’t coming up with the required goods.
Of course, no realistic UK waste strategy could presume to fly
in the face of EU prejudices. “Waste Not, Want Not” celebrated
recycling, but in any case certainly had to take an anti-landfill,
pro-recycling point of view. It then went on to consider how to
send the right signals, both regulatory and economic. This included
the idea – howled down when it was trailed – that householders
might be charged a variable fee, according to how much waste they
produced.[24]
Waste economics and policy
Sustainable Development and the Polluter Pays principle.
No modern policy can be sold unless it can be expressed in terms
of “Sustainable Development”. This “principle”
suggests that we must find means of having economic growth (development)
within ecological constraints (which would ensure its viability
– or sustainability).
This is a matter of marrying ecological and economic goals.
Thinking along these lines has lead policy-makers to want economic
players to pay for the ecological damage they do. This is called
“capturing the externalities”. This might seem to be a
doomed attempt to put a price on the priceless (and “deep”
Green thinking certainly does see it this way). But it can be defended
as the only way of ranking undesirables: it must be right to “fine”
lesser polluters less than greater ones. One has to attempt such
prioritising.
To apply fiscal measures, one must be able to identify the economic
player who should bear responsibility, and to whom it makes sense
to apply pressure. Enter, the Polluter Pays Principle. This has
become a core policy mantra, and like most Green mantra, it does
not, actually, bear very much inspection. Yes, it goes well with
seeking villains and placing blame. But its great weakness is that
it provides no guide to the one thorny issue at stake: who should
we target when we aim at the “polluter”? Do we mean the
last to touch the product in question (the consumer, usually)? Or
do we mean the other end of the chain: the producer? Or anyone in
between: the wholesaler or retailer? The Greens will habitually
settle for any soft touch in the chain - normally the deepest pocket,
the politically weak, the PR-conscious. So they are very fond of
placing blame and responsibility at the door of manufacturers and
retailers – or the waste industry.
The Greens and many policy-makers (the EU, for instance) like
the idea that firms should pay charges for the waste disposal costs
their products will eventually cause. The campaigners might not
care much whether it’s the manufacturer or the retailer that
is penalised, both are reassuringly capitalistic.
But there is a profound problem here. Charging firms for the waste
they cause consumers to throw away doesn’t connect the consumer
with the problem the waste causes.
Many ecologically unsound waste solutions (wrong-headed charges
on, or barriers to, consumption; too much recycling) would impose
costs and inconvenience on waste-producers. At the moment, many
of these costs are borne by Local Authorities, who have not really
made clear how they are borne by "consumers" - the voters.
(The difficulty here is that local authorities are too busy “selling”
the virtues of recycling to be keen to tease out its expense.)
It would make sense that as many of these costs are made highly-visible
to those who must ultimately bear them. Thus, we could also claim
to put the Polluter Pays principle into play.
To be fair, the Greens are very keen that everyone in society
should be engaged with the waste issue. They want householders to
separate their waste into lots of different streams, each to its
own box, for recycling. They think this engagement is so good (healing
and instructive) in its own right that they often argue for it even
whilst conceding that it may be doing no ecological good and may
well be expensive (which they think a virtue in itself).
So we can borrow some Green tendencies, and even rather wickedly
pretend we like the Polluter Pays Principle, as we suggest that
householders should see and feel very clearly the costs - necessary,
useful, or absurd - of waste disposal policy.
This direct charging approach would connect the final-disposer
with the realities of waste disposal, and the realities of planning
and other decisions which affect it. There is hot dispute amongst
the policy-makers about charging householders. The biggest issue
is whether householders should be made to pay a more visible version
of the current flat-fee, or whether we should move on to a “Pay
To Throw” system, by which households are charged according
the amount of waste they throw away. One problem with this is that
poor or irresponsible households would be tempted to fly-tip. Another
is that the problem with waste is not necessarily either bulk or
weight – it is toxicity: people might be perversely tempted
to hide their worst waste in ways neither visible nor weighable.
Any of these approaches would make situation clearer than it now
is. An authority would be free to adopt expensive and inconvenient
policies if it liked. But instead of seeming to impose costs on
anonymous or disliked producers and authorities, the Greens and
their capture of policy would be seen to be costing each of us real
money. Voters and consumers would have an incentive to take an interest
in seeing if waste policy made good environmental and economic good
sense.
Where are we right now?
The UK government (see the remarks on “Waste Not, Want Not”,
above) has toyed with the idea of charging householders for the
amount they throw away. Their proposal was criticised as being an
excessive new charge on the poor – and as being likely to lead
to fly-tipping (as Americans say has happened there and as the Swiss
say doesn’t happen there).
There are some signs that current EU consultations allow that
we need to avoid clumsy fiscal measures – applying the wrong
charges in the wrong places[25]. So there is a chance to get good
policy there.
It doesn’t much matter that EU, and thus UK, policy has to
adhere to the Waste Hierarchy for now. If we use the right charges
and subsidies to gently nudge many waste disposal experiments into
being, we will soon have the evidence with which to confront current
prejudices – or to confirm that they are well-founded.[26]
There is increasing evidence that underneath politically-correct
rhetoric, policy makers are preparing for this more nuanced approach.[27]
There are several locations where good sense on the economics
of waste policy is being promoted. The OECD seems an obvious one,
and some parts of UK officialdom is another. Several academics seem
to understand the issue, as do several EU governments.
In Europe, the position seems surprisingly fluid, and open to
good policy-making.
A note on the waste industry: where the buck stops
One should for parity's sake perhaps point out some false arguments
or dangerous prejudices from the waste industry, to match those
of the Greens. The difficulty is that the waste industry makes very
few claims - it seems mostly merely to wish that other people's
claims had rather more substance.
The waste industry is capitalistic, and thus not a favourite of
the Green mindset. Beyond that, the industry was mostly built on
the loathed landfill, with some participants branching out into
- or specialising in - incineration. So they were natural targets.
Now some of these firms have branched out into recycling and composting,
so that ought to help their political image problem a little.
The industry may be able to present itself as not so much part
of the problem as part of the solution. But there is something more
intriguing about its having so many fingers in so many different
waste technologies. This is to say that the waste industry might
be thought to have a positive interest in bad policy. True, many
firms own holes in the ground and have become very expert in the
politics of getting planning permission to use them as landfills.
So they might be thought to dislike the modern political preference
for outlawing landfill. But they are canny enough to see that landfill
has a long future and that other technologies will become part of
the suite they must deploy. And these other technologies - recycling,
for instance - provide many more opportunities for adding value.
They are inherently expensive, and likely to provide decent room
for profit margins.
Waste disposal is a difficult, politically tense, capital-intensive
business in which existing players are very likely to maintain existing
toeholds and opportunities. As Green politics drives the regulator
towards more and more sophisticated options, the business will quite
likely become more and more profitable. The EU’s landfill directive
alone has led to the UK landfill tax, but also to new regulations
which have doubled the turnover of the sector.
This analysis might lead the casual observer to suppose that firms
could more or less indifferently read the runes as to likely regulatory
futures, and plan accordingly. They could cheerfully adopt fashionable
mantras which slate landfill and celebrate recycling.
There is however a powerful countervailing engine toward a sort
of virtue in the waste industry. This is the fact that firms have
to manage reputational issues which have much longer timelines than
apply in politics. Waste firms know that twenty years hence they
will be answering questions about their early-third millennium practices
and the rationale which drove them. If landfill, incineration or
recycling turn out to be inefficient - if they turn out to contribute
overly to global warming, or pollution of any kind - the media,
campaigners and politicians of the day will cheerfully lay much
of the blame at the “polluter”, the firms who promoted
and profited from these technologies.
There is therefore a strong driver for the firms to ensure that
their arguments today will hold water now and for a long time to
come.
But note the way this different timescale affects politicians.
They will seek attractive solutions (ones which accord with their
view of the world), and try them out on voters. Naturally, if they
sense that the preferred policy is finding favour, they will pursue
it. If not, then there are some issues which it is fairly safe to
delay for a few years. Pensions, nuclear power and waste management
all come into this category. They are controversial in different
ways, but they have it in common that delay in grasping the nettle
is politically attractive.
A note on the funding of this paper
The Environment Services Association (the trade body of the UK
waste industry) funded my attendance at an OECD seminar on the economics
of waste. This brought me up to date with policy making in this
area, and I am very grateful for it.
--------------------------------------------------------------------------------
[1] Richard D North is media fellow of the Institute of Economic
Affairs (www.iea.org.uk). www.richarddnorth.com.
[2] OECD, 2003a OECD Seminar on waste, Paris 2003, DEFRA paper,
forthcoming
[3] OECD, 2003 OECD Seminar on waste, Paris 2003, Sigman paper,
forthcoming
[4] OECD, 2003 OECD Seminar on waste, Paris 2003, Fullerton paper,
forthcoming
[5] OECD, 2003 OECD Seminar on waste, Paris 2003, remark by Swiss
delegate
[6] OECD, 2003 OECD Seminar on waste, Paris 2003, remarks by Danish
and Norwegian delegate
[7] OECD, 2003 OECD Seminar on waste, Paris 2003, Fullerton and
Raub paper, forthcoming
[8] Whether local voters want a landfill or an incinerator for
municipal waste will determine which of these options are available
to industry.
[9] EU, 2002 Environmental Technologies Action Plan, Waste Management
– Working Document (18/12/2002), 2nd Draft of Discussion Document:
"A central role is played by the concept of hierarchy. This
concept proposes the following list of waste management option in
decreasing order of priority: first comes the reduction of waste
generation then reuse, then recovery, and last disposal. The recovery
steps covers various options such as material recycling, energy
recovery or composting, which are sometimes also ranked according
to a often contested hierarchy. [rdn note: this usually runs: recycling,
composting, landfilling, incineration, with the last two reversible
according to taste]
[10] OECD, 2003 OECD Seminar on waste, Paris 2003, OECD Secretariat
paper, forthcoming
[11] EU 2003 Towards a thematic strategy on the prevention and
recycling of waste, EU COM(2003) 301 final, Brussels, 27.5.2003:
“In recent jurisprudence the European Court of Justice developed
a criterion for distinguishing between waste recovery and waste
disposal. According to the Court, a waste treatment operation is
to be classified as recovery when the fundamental objective of the
operation is that the waste substitutes the use of primary resources.
The Court has notably concluded that filling a mine with waste could
be a recovery operation if the waste is used in replacement of primary
resources that would have otherwise been used for the purpose of
filling the mine . This could for instance be the case when, for
the purpose of stabilising land a mine must be filled. The Court
also concluded that use of waste as a fuel in a cement kiln is recovery
when excess heat is generated and this heat is used in the process
. In contrast, the Court decided that incineration in a dedicated
municipal waste incinerator has for primary objective to dispose
of the waste. The Court added that, in the cases analysed, this
classification as disposal operation would not be changed if, as
a secondary effect of the process, energy is generated and used.”
[RDN comment: this is surely a weird judgement – it implies
that provided one pretends to want the energy more than the waste
disposal, incineration becomes virtuous.]
[12] Resource, Nov-Dec 2003, Breaking the chain: “But with
limited Energy from Waste [EfW] capacity – and the removal
of major EfW activities as a recovery process compliant with the
Packaging Directive targets – a new approach will be required
…… ”
[13] Sita, 2003 Environment Report, 2002, page 16: A useful explanation
of the role of energy from methane captured from landfill sites
(some is burned-off in flares, which is less-bad than its being
voided to the sky – but recovery for energy-use is growing).
[14] OECD 2003a
[15] EU, 2002: “ The major challenge for the recovery of materials
from the ‘difficult’ waste streams was to know the real
cost of the whole recovery chain. We must here distinguish between
the overall cost and the cost of the recycling step per se. A ‘profitable’
recycling step does not necessarily mean that the overall recycling
activity is profitable. One of the major lessons learnt, is that
the most important factor that determines the overall profitability
of recovery operations is the cost of collection and sorting.”
[16] See this link:
http://www.environment-agency.gov.uk/yourenv/eff/resources_waste/213982/203410/?version=1&lang=_e%20
[17] OECD, 2003 OECD Seminar on waste, Paris 2003, Martinsen and
Vassnes paper, forthcoming
[18] EU, 2003: “Better management of a number of problematic
waste streams has been achieved through Community directives on
specific waste streams. Important hazardous wastes have been addressed
such as waste oils, PCBs/PCTs and batteries. Heavy metals have and
are being further restricted by Community waste legislation in a
number of products, aiming at qualitative prevention. Recycling
and recovery targets have been set for some key complex waste flows,
i.e. packaging, end-of-life vehicles (ELVs) and waste electrical
and electronic equipment (WEEE). Such targets are necessary where
separate collection and recycling are not profitable under free
market conditions but are beneficial from a societal point of view.
Although these targets are generally the subject of much debate
during the adoption process, once adopted they provide the legal
certainty and stability necessary to allow the recycling industry
to programme investments in the knowledge that there will be a demand
for recycling services.”
[19] http://europa.eu.int/comm/environment/natres/ and http://www.esauk.org/
[20] EU, 2003: "The objective of this Communication is to
launch a process of consultation of the Community institutions and
of waste management stakeholders to contribute to the development
of a comprehensive and consistent policy on waste prevention and
recycling. Waste prevention and recycling policies shall contribute
together with energy recovery and sound disposal options to the
achievement of an optimal waste management strategy aimed to minimise
environmental impacts through the adoption of the most cost-efficient
option." And this: “Waste treatment is only one of the
ways in which waste generates environmental impacts. Improving the
efficiency of resource use is just as important. This is where waste
prevention and waste recovery, whether energy recovery or material
recovery can make a specific contribution to reduce the environmental
impact of resource use, above and beyond what can be achieved by
regulating waste treatment processes.”
[21] For the Tories under Margaret Thatcher and John Major, William
Waldegrave was an early example of a British minister who learned
to take the environment very seriously (in the mid 1980s); Chris
Patten followed this lead. But it was John Gummer who was both a
more senior minister and most completely “Green-ed”. Under
Tony Blair, Michael Meacher as environment minister became (if he
was not already) spectacularly “Green” and in the end
resigned (though as much over Iraq as over the Government’s
GMO policy). For instance, Mr Meacher seemed unable to endorse incineration,
though the Environment Agency – his statutory professional
advisor – did.
[22] Barbara Young, a former director of the Royal Society for
the Protection of Birds, a green campaign group was appointed chief
executive of the Environment Agency, an essentially technical body.
[23] http://www.number-10.gov.uk/su/waste/report/01.html
[24] http://www.number-10.gov.uk/su/waste/report/00-2-es.html
Document: "Waste not, Want not - A strategy for tackling the
waste problem in England" (November, 2002)
Heading: Executive Summary
[extract]
Heading: Putting in place a robust economic and regulatory framework
is the most essential ingredient for success
This requires:
[various measures, including...]
.....greater freedom for local authorities to develop new financial
incentives for householders to reduce and recycle their waste. Households
currently pay the same Council Tax no matter how much waste they
produce or whether they recycle or not. This means that they have
no incentive to manage their waste in more sustainable ways. This
report has identified 17 other major industrialised nations where
incentives are available for households who produce less waste,
and/or recycle and compost more. These schemes have helped reduce
waste growth, contain costs, and achieve recycling rates 3-4 times
higher than that of the UK. Comparable incentives that could be
taken forward in the UK include: Council Tax discounts for people
who recycle or compost; reward schemes for people who recycle or
compost regularly; and giving local authorities freedom to introduce
variable charging schemes, where the Council Tax element for waste
would be removed and charges to households made according to the
amount of un-recycled and unsorted waste they produce….
[25] http://europa.eu.int/comm/environment/natres/ and http://www.esauk.org/
[26] See the Advisory Committee on Business and the Environment
at http://www.defra.gov.uk/environment/acbe/default.htm and in particular:
http://www.defra.gov.uk/environment/acbe/pubs/pdf/acbe-greentax-final.pdf
ends
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