EU waste diktat could cost Britain £2 billion

March 1, 2017

“EU waste diktat could cost Britain £2 billion”. That is the headline from a new report published by Policy Exchange today, Going Round in Circles.

The report provides a critical review of European and UK policies concerning waste and recycling. Waste is one of a number of areas of environmental policy in which the UK has largely ceded control to the EU. European Directives define the overall framework for how we manage waste, set targets for recycling and landfill reduction, and regulate the operation of landfill sites and energy from waste facilities.

Successes and Failures

The combination of these policies has had a transformational impact on the way we manage waste and resources in the UK. Our total resource consumption has fallen by 20 percent since 2003, whilst the total amount of waste generated in the UK has fallen by 16 percent since 2004. Municipal recycling rates have increased from 12 percent in 2000, to 43 percent in 2014 in England. Since 1990, there has been a 75 percent reduction in greenhouse gases emissions from waste management, whilst dioxin emissions from waste incinerators have fallen by 99 percent.

However, whilst there have been some notable successes, there are also some significant shortcomings in the EU’s approach towards waste:

  • Objectives are unclear: The objectives of European waste policy have evolved over time, and are now rather muddled. This is particularly true of the Commission’s proposed “Circular Economy” package, which appears to be justified as an end in itself, rather than a means to achieving a particular set of economic, environmental or social outcomes.
  • Fails to reflect UK context: it is clear that the EU is designing waste policies that are not in the interest of the UK. The European Commission’s own analysis shows that adopting the proposed “Circular Economy” package would cost UK businesses and households an additional £2 billion.
  • Ignores the fundamentals: European waste policies fail to reflect the economic fundamentals. For example, commodity prices have fallen sharply since the Great Recession, undermining the economics of recycling and leading to a number of notable company failures in the recycling sector in recent years.
  • Poor data and definitions: Waste policy suffers from some serious issues regarding definitions, measurement, and data quality, making it difficult to develop effective policies.

Developing a New Approach to Waste Policy

Given these shortcomings, it is clear that the UK Government should not simply accept current and proposed European policies concerning waste. Instead, following Brexit there is an opportunity for the UK to define an approach which suits us better.

This needs to be reframed around a much clearer set of objectives, underpinned by a coherent set of targets and policies. Waste policies should be framed around the idea of increasing resource productivity, rather than the more nebulous language of creating a “circular economy”. There is a sizeable opportunity for UK businesses to improve their productivity and competitiveness by increasing their resource productivity. This is recognised in the Government’s Industrial Strategy green paper, but further thinking is needed on how to realise this opportunity.

Beyond this high level reframing of waste policy, the report makes a number of key recommendations:

  • Government should provide more clarity on the environmental objectives we want to achieve through waste policy, and should develop a carbon-based metric to manage the total greenhouse gas emissions from waste management.
  • Waste policy should focus far more on waste prevention and reuse, to reduce the amount of waste we generate in the first place.
  • Household Waste and Recycling Centres (or ‘tips’ as they are commonly referred to) should be used as a collection point for reusable items, which can then be sold or redistributed to local charities. This approach is technically illegal under current waste rules.
  • Local Authorities should use one of three standardised systems for collecting waste and recycling – simplifying the more than 400 systems which currently operate across England.
  • Government should encourage innovation in the recycling and reuse of materials, and help to develop markets for scrap materials.
  • Government should also promote efficient forms of energy from waste – for example using black bag waste to create ‘green gas’ which can then be used for heating or as a transport fuel. Last year the UK spent £280 million exporting waste overseas (mainly to the Netherlands) where it was used to generate energy. We could be generating energy from this waste in the UK.

The vote to leave the EU provides an opportunity for the UK to re-examine waste and other environmental policies from first principles. The UK Government needs to grasp this opportunity, and develop a more coherent and effective set of policies which is smarter, greener, and cheaper.

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