Making Things Last: Scotland Counts on Circular Economy

Scotland has set ambitious targets. “Biodegradable municipal waste will be banned from landfill from 2021, and we have a target to send no more than five percent of all waste to landfill by 2025,” the Scottish Government proclaimed in February 2016. Therefore, the Government published a “strategy plan” for a circular economy named “Making Things Last” in order “to build a strong economy, protect our resources and support the environment”. But it seems that the way to reach this will not be easy.

Admittedly, Scotland’s household recycling rate has increased substantially in the last decade. Latest figures published in September 2018 indicate a quote of 45,6 percent or 1.12 million tons of recycled waste respectively – for the first time more than the amount of 1.11 million tons sent to landfill. But the rate of growth in these recycling rates has been slowing down since 2014, and the Scottish Environment Protection Agency (SEPA) had to admit “that further intervention is required to stimulate growth in household recycling rates in order to achieve national recycling targets for 2025”.

Largest amount: paper and cardboard wastes
The most considerable type of household waste recycled or reused in 2017 was paper and cardboard wastes with 226,495 tons or 32.0 percent of all waste recycled or reused respectively, followed by 104,679 tons of glass waste, 94,037 tons of construction and demolition waste and 89,426 tons of wood waste. Recycling and reuse of plastic wastes resulted in 51,833 tons, 50,275 tons came from metallic wastes, and about 90,000 tons were discarded or fell under “others”.

Scotland reused around 89,000 tons of material, including 12,000 tons of furniture, 9,500 tons of electrical items and 66,000 tons of textiles, with a totaled turnover of approximately 244 million pound sterling (276 million Euro). Household waste composted or digested amounted to 416,753 tons, while 1.11 million tons were sent to landfill. Waste managed by other diversions from landfill added up to 230,983 tons, of which 175,296 tons (75.9 percent) were managed by incineration, followed by 44,378 tons otherwise treated (19.2 percent) and 11,308 tons of non-certified composting or digestion (4.9 percent).

Many targets have been set
But the Government wants more: By 2025, Scotland expects to reduce total waste arising in Scotland by 15 percent against 2011 levels, to reduce food waste by 33 percent against 2013 levels and to recycle 70 percent of remaining waste. Furthermore, no more than five percent of remaining waste should be sent to landfill until 2025, and the EU ambition for all plastic packaging to be economically recyclable or reusable is aimed to be realized by 2030 (not regarding Brexit changes).

Many targets have been set with the aim of reducing waste. For example, Scotland’s Zero Waste Plan (2010) is setting out a concept of waste as a resource. The Waste (Scotland) Regulations 2012 is providing principles for the collection, transport and treatment of dry recyclable waste, food waste, and related matters. In the Safeguarding Scotland’s Resources Program (2013), advocating the reduction of waste and the creation of a more resource efficient and circular economy. In the Single Use Carrier Bags Charge (Scotland) Regulations (2014). In the Charter for Household Recycling in Scotland (2015), launched by the Scottish Government to bring more consistency to recycling services. In the Making Things Last Strategy (2016) mentioned above, targeting a strong economy, protected resources and supported environment. And in the Climate Change Plan (third report, 2018), expecting waste sector emissions to fall by 52 percent over the lifetime of the Plan.

Financial consequences
According to a paper on an “Economic Assessment of the Zero Waste Plan for Scotland” in July 2011, the financial consequences of meeting or not meeting the Plan targets can be numbered. The costs for management of household waste under a business as usual scenario would rise from 256 million pound sterling in 2010 to finally 319 million pound sterling in 2025, while in the zero-waste scenario they would merely increase from 256 million to 296 million pound sterling – a benefit of 23 million pound sterling. In the commercial and industrial waste sector, the continuing sequence of events would change from zero to 98 million pound sterling, whereas the zero-waste scenario would reach 106 million pound sterling – ending in additional costs of 8 million pound sterling. And the scenarios of the construction and demolition sector would result in a benefit of about 5 million pound sterling. So, the situation for all waste streams including household, commercial and industrial, construction and demolition waste streams shows a net financial saving of 18 million pound sterling per annum, amounting to 178 million pound sterling in net present value terms over the period 2011-2025. Between 2010 to 2025, the sorting and pretreatment of waste – depending on the starting point – could lead to savings in environmental costs of a total of 1,544 million to 1,177 million pound sterling, respectively.

Not at zero costs
Of course, the change to a zero-waste economy was not possible at zero costs. The paper offers numbers: “Over the period examined, the additional capital cost of the Zero Waste Plan Scenario for all waste streams is of the order 472 million pound sterling. The total capital requirement for ZWP is around 1.16 billion pound sterling.” And: “The additional facilities required to manage household waste are likely to incur an additional capital requirement of around 350 million pound sterling, the total figure being 490 million pound sterling.” The higher capital costs than those under the business as usual scenario are “reflecting the reduced reliance on landfill, and increasing reliance on both biological treatment, and non-landfill residual waste management”. According to Eunomia Research & Consulting, haulers and exporters will see an economic benefit, whereas private collection contractors and local authorities will bear the greatest costs. Local authorities, the paper recommends, could raise capital funding through payments of the gate fee type, so that the costs of supporting infrastructure effectively come from revenue spending rather than capital budgets. “Much depends on how the relevant facilities are to be procured.”

The Circular Economy Investment Fund
The Zero Waste Plan was launched in 2010, the legislation to enact it introduced in 2014, and in addition, a Circular Economy Investment Fund was established in April 2016 by the Scottish Government. It was the first fund of its type in Scotland, supporting small to medium enterprises “to commercialize innovative technologies and processes which help to accelerate a circular economy and is administered by Zero Waste Scotland”. The fund was designed to subsidize organizations wishing to explore and pioneer circular approaches and develop and bring new business models and innovative technologies to market. From 1st of April 2016 to end of December 2017, the fund made 16 payments that aggregated to 4,547,870 pound sterling (about 5.1 million Euro). The funding ranged from 3,200 pound sterling for Jaw Brew, a circular microbrewery in Glasgow taking waste grains from brewing to make an energy-rich food bar, to 581,507 pound sterling for Xanthella, looking at algal production from whiskey by-products. The investments supported in the main printing, biotechnology, collection serving, consultancy, furniture re-use, lighting, mattress recovery, copper recovery, polymer recycling, brewing, timber re-use, chitin extracting, plastics sorting, hydrocarbon producing, coffee grounds recycling, R&D equipment re-use and WEEE-re-use companies. Jill Farell, chief operating officer of Zero Waste Scotland, is quoted with the information that the fund offers grants to businesses rather than investments and that none of the details of the projects had been revealed before November 2017. But she confessed that it needs a long time before projects prove to deliver real tangible results.

Some success stories
However, some waste handling companies wrote success stories. The online-magazine insider.co.uk described, for example, how the William Tracey Group improved, reacting to the first environmental taxes, starting alternative forms of recycling, investing in infrastructure and expanding through acquisitions and strategic alliances. The author of the article analyzed the Scottish waste policy and market and titled: “How the business of waste in Scotland is a real growth industry.” To give a second example, in October 2016 Swiss-based Hitachi Zosen Inova and Spanish-based FF Medio. Ambiente S.A. signed a contract for the planning, constructing and building of a waste-to-energy facility. The plant is provided to annually treat 155,000 tons of non-recyclable domestic and commercial waste from Edinburgh and adjoining councils and to deliver electrical energy to 32,000 households.

The landfill ban on biodegradable waste
But there will be a drop of bitterness. In June 2017 at the Waste Evidence Session, Zero Waste Scotland answered questions posed by the Environment, Climate Change and Land Reform Committee on the issue of Scotland’s waste. Amongst others, during the session, the consequences of the 2021 landfill ban on all biodegradable municipal solid waste have been pointed out. Moreover, the Scottish Environment Protection Agency and Zero Waste Scotland concluded “that a 0.4 to 1.2 million tons shortage in non-landfill residual treatment capacity is very likely, meaning Scotland will need to export this waste to elsewhere in the UK or EU member states for treatment in order to comply with the ban”. This – so the experts – could be diminished by improved recycling of dry recyclates and food waste and additional incineration capacity.

In March 2019 this proved to be true when Eunomia Research & Consulting published a report examining the current and future markets for the disposal and recovery of biological municipal waste. The study, commissioned by the Scottish Government, can be summarized in the sentence: “The alternative waste management options that will be needed may not be available at sufficient scale, or at an affordable price at the point when the ban commences.” Of 32 local authorities accountable for residual household waste, 14 have fulfilled the financial investment needed to comply with the ban in 2021. Three authorities have only long-term solutions, six secured merely interim solutions, and nine authorities have not taken alternative arrangements. Commercial waste operators are also not adequately prepared for the ban: First of all, they concentrate on transporting waste either to landfill or treatment facilities in Northern England or to thermal treatment plants abroad. Given that waste continues to be exported further, the possible costs reach a total of 943 million pound sterling or 1.1 billion pound sterling respectively. If new treatment facilities come on stream, the costs are instead estimated at 414 million or 449 million pound sterling respectively, the study promises.

100 million pound sterling Landfill Tax gift
According to the Scottish Environmental Services Association, the voice of Scotland’s resources and waste management industry, industry investment in nearly 950,000 tons of additional treatment capacity had been made to help meet the 2021 ban. But “a lackluster residual waste policy framework coupled with an uncoordinated approach to public procurement has proved the greatest hurdle to securing the additional investment needed to close the capacity gap further”. As there is no landfill ban planned for England, industry experts believe this will mean that the majority of this waste will move across the border to England.” SESA’s policy advisor, Stephen Freeland, got to the heart of the consequences: “This will be a 100 million pound sterling Landfill Tax gift to the English revenue.”

“The ban will have a negative overall economic impact on the Scottish economy”, the study by Eunomia balances. But it also points to some environmental impacts through additional haulage required for the export and the possibility of building additional thermal treatment capacity “necessary to provide a long-term solution”. And above all: The study only focused on the results of the ban, but not on the substantial economic and environmental benefits to be expected from the increase in reuse and recycling.

Investing in Scotland’s future
These benefits could be enormous Zero Waste Scotland is convinced. So, in October 2018, the organization released that “key regions of Scotland could be at the heart of an estimated £1 billion boom for circular economy businesses in Scotland”. The news was related to Edinburgh, North East Scotland, Tayside and Glasgow. For Aberdeen and Aberdeenshire for example the predicted economic benefits would add up to approximately 625 million pound sterling, including 286 million pound sterling for the construction and built environment sector, 250 million pound sterling for the energy infrastructure sector, 52 million pound sterling for the food sector, the drink sector, and the bio-economy, and 37 million pound sterling for the manufacturing sector. First Minister Nicola Sturgeon was positive: “Scotland is already leading the way with its ambitious and challenging targets for recycling which are above and beyond the EU targets. However, we want the narrative to move beyond recycling to re-use, repair and remanufacturing of items.” Consequently, the official 2019/20 Scottish Budget is “Investing in Scotland’s future” among others more than 20 million pound sterling for zero waste, supporting the transition towards a more resource-efficient, circular economy, including design and implementation of a deposit-return scheme.

(GR32020, Page 26, Photo: NadinLisa / pixabay)