Defra RDF Call for Evidence Response
Defra response to Call for Evidence on the UK RDF Market
Defra launched a Call for Evidence on the UK Refuse Derived Fuel (RDF) domestic and export market in March 2014.
The aim was as follows:
- To determine whether there was a case for taking action, to ensure that the waste hierarchy is fully applied and the environmentally beneficial outcomes of alternative waste management routes are fully realised, for example by introducing a common standard.
- To fill the gaps in our evidence base to Defra determine whether there is a need for some form of intervention to deliver the desired environmental outcomes and, if so, help them to develop workable policy options.
REA Summary Position, RDF Call for Evidence
Following consultation with members, the REA submitted the following response:
1. We have been unable to source effective evidence on the RDF market and this suggests that Defra may struggle to receive hard evidence on which to draw firm policy conclusions. We therefore suggest that as a first step Defra commission their own research into the RDF market in order to make assessments based on up to date, ‘hard’ evidence. The researcher should be a mutually respected and acceptable organisation able to take a completely neutral view.
2. Our members believe that if existing standards and national boundary practices are properly enforced there is no need for a defined UK RDF standard. The REA does not support the need for a UK RDF standard which may isolate resources as technology develops but seeks a more proportionate approach which include the introduction of a standard for production methodology such as the CEN EN15359.
3. We should not be restricting the free movement and trade in RDF particularly as we do not currently have sufficient infrastructure to treat all the RDF currently produced.
4. The REA believe that it is arguably the gap in government policy regarding Industrial and Commercial (I&C) waste that has created this situation as the domestic market is more regulated. The vast majority of recent RDF exports come from waste derived from the I&C sector and therefore a more joined up approach would be welcome here.
5. Arguably the export of RDF should be seen as a valuable interim solution until such time as the infrastructure within the UK has the ability to treat this material. It is preferred that the UK develops this infrastructure at the earliest opportunity as this is a wasted opportunity to develop ‘home’ energy generation from waste. We note the good intentions of the Government Heat Strategy but actions is needed on a wider scale to see through the intent.
6. We do not have evidence that indicates that the continued affordable use of export as a mechanism to mobilise RDF acts as a disincentive to UK based developers, however with increasing lengths of contracts between the UK exporters and European processors it is likely that there are going to be fewer drivers this side of the water for funding new facilities.
7. Government should make its position clear on available feedstock and capacity to use this, and therefore offer certainty to the industry and greater investment confidence. The recent report from SITA UK – ‘Mind the Gap’ details the industry’s view of future deployment. Feedback from REA members is that the figures are generally correct to within a couple of million tonnes.
8. The REA recognise that there is widespread development in Europe of district heating schemes in close proximity to R1 facilities. Given that these heat networks already exist, it may be difficult for new developers in the UK to compete as the cost of developing heat networks (and incineration facilities) has already been borne by European competitors, whereas such networks are yet to be widely developed in the UK.
9. There is an understanding that RDF exports have been useful for some UK developers, in that it has allowed facilities to produce RDF to be developed, knowing that they definitely have a defined market. This is a necessary precondition for UK plants to be built and has enabled some UK projects to produce their own feedstock before they had a project that could utilise it. Therefore any outcomes which could restrict free trade in waste could be undesirable to renewable generators using this feedstock, as the export market has helped develop the RDF production process in the UK.
10. The REA would like to see the existing bond requirements for Transfrontier Shipments to be applied to new facilities, therefore providing some form of financial guarantee. This would assist in ensuring that ‘sham’ or illegal’ recovery was less likely to take place. Industry feedback suggests that TFS (trans-frontier shipments) should require evidence of the final user (ie the offtaker) to reduce the incidence of illegal dumping of RDF.
11. Although it is not possible to say that current RDF exports are bad per se or whether such exports impede the future development of the ACT industry, which uses RDF as a feedstock, it is still clear that increased export contract lengths is a risk for some ACT project developers already in terms of obtaining bankable feedstock contracts for their plants.
Government Response
In early December 2014 Defra published their Government Response to the Call for Evidence, and accompanying Summary of Responses.
The response acknowledged the ‘environmental rationale for intervention in the RDF market in England’, and noted that ‘the overriding message … is that some form of Government intervention is necessary to address existing market failures’.
The key recommendations Defra will take forward are as follows:
New definition/treatment standard
-Considering introducing a short definition of RDF in England.
-Considering introducing a treatment standard for RDF in England.
-Defra also commit to considering the potential costs and benefits of such interventions on industry and how to introduce these.
-Review the quality of RDF following the introduction of mandatory separate collection of waste in January 2015, and a review of EU recycling targets.
Regulation Enforcement
-Recognition of enforcement as a key issue, which they believe can be addressed through the Waste Crime Action Plan already being taken forward.
Storage of RDF
-RDF storage will be subject to a permit requirement
-The EA will be more proactive in intervening and tackling poor performance
-There will be new procedures for assessing competence of operators
-Revised standard permits are being consulted on with more emphasis on appropriate site management systems, they are also consulting on more scrutiny for sites which are newly permitted (as part of the EA fees consultation)
-Storage of RDF will be subject to time limits and stock rotation requirements set out in regulations
Preventing malpractice in the RDF Market
-Consideration will be given to introducing financial guarantees or bonds for permitted sites in the Waste Crime Action Plan.
-Demonstration of suitable end-user arrangements are also possible in the environmental permits assessment process, the EA will consider this further.
Actions suggested in consultation responses, not to be taken forward:
-A ban or tax on UK RDF exports
-Increasing the Landfill tax
-Subsidies for UK EfW plant gate fees
-Tightened R1 criteria
-Changes to the planning system
-Further incentives for UK incineration plant capacity
Potential definition and treatment standard
It is unclear at this stage exactly how the standards might be developed and how and when they would apply.
The Northern Ireland RDF ‘regulatory position statement’ is referenced as a possible model of the approach that could be taken,acting as a starting point for the work - this statement sets out the treatment process and evidence required to demonstrate this has been adhered to.
Clearly this would be an important development in the RDF market as there is currently no European standard for RDF.
Next steps
Defra say they will work closely with industry on the development of a possible definition and treatment standard, and the possible impacts.We will work with them to discuss the proposals and ensure members views are incorporated.
We of course welcome member views on how this should be approached and industry aims for the content.
REA, 3rd December 2014
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