Three years ago, I landed on these shores fresh from working for more than 25 years for the Utilities sector in Northern Europe. I have seen many positive changes in the resource recovery landscape since I arrived, but there remains, in my opinion, the need to pivot the ambition of the Circular Economy supply chain, and this will mean change for all those involved. But this change will create a massive opportunity for commercial growth and environmental gains.
A recent article published in Inside Waste caught my eye, because it unjustly criticised the government and Environment Protection Agency (EPA), who have in recent times demonstrated a bold shift in the right direction. I think our sector needs to cease this negative public narrative and focus its efforts solely on collaboration with governments, co-design with regulators, and co-habitation of the environmental space with campaigners - because we are all on the same side and want the same outcomes.
It is absurd to criticize strong government leadership and progressive EPA policy when it's focused on delivery of the environmental infrastructure that the industry agrees is needed. As an example, the NSW policy around energy from waste (EfW) plants will allow NSW to get moving on these complex projects now. Whilst not perfect, this framework will support a shift up the waste hierarchy, provide emissions reduction, preserve resources and generate renewable bio-energy in a relatively short time frame.
A recent example of where industry appears to be caught on the back foot is on how we effectively collect, sort and manage soft plastics. We’ve got some great trade bodies, such as NWRIC, WMRR, and ACOR, who are doing a phenomenal job advocating for better environmental outcomes overall.
Despite these voices of reason it’s hard to believe we are talking about collecting soft plastics through kerbside recycling when the material is mostly unrecyclable. I would go further to say that soft plastics are such an important and vital ingredient to putting low carbon fresh food on the table, at reasonable cost. So, we must find a middle ground.
I fully advocate for packaging to be created with circularity in mind. But where it can’t be avoided and serves a fundamental purpose for society, we should be less obsessed about recyclability and consider its use as an energy source replacing dirty coal and natural gas - something embraced by Europe's energy sector. We should still recycle as much of the recyclable grades we can - that makes good sense - but for complex multi-layer materials which protect meat or fresh products, let's not throw the baby out with the bathwater and move to less sustainable high carbon materials. Coupled with the challenging compostable packaging movement, soft plastics in the recycling bin threaten to become a perfect storm to destroy the chance of 80% recovery by 2030.
It’s encouraging to see the next generation of thinkers in the waste and resources space - the ones prepared to collaborate - out in force. We’re seeing it in government policy, EPA leadership, and throughout the supply chain, from manufacturer right through to waste recycler. It’s evident amongst the ‘big 5’ but also the entrepreneurial mid-size players, and the ‘RE’ groups, who are all eager to invest in the future of what we call Ecological Transformation.
As an industry, we have wider issues facing us around exports, levies, consistency across states, waste crime and policy enforcement, but we also have - in tandem - a growth opportunity if we move on from the current paradigm we are stuck inside. This big growth picture is not about stopping progress or policy, not about increasing costs to shut down conventional technologies or going back to all riding bikes instead of driving cars, but an industrial revolution 2.0. This is a transformative shift where we continue to mine, manufacture and manage Australia's rich resource base to the benefit of Australian citizens, whilst at the same time contain, prevent, avoid and clean - or essentially depollute our sunburnt country.
Depollution, as well as decarbonisation and implementation of a circular economy are the main drivers of Veolia’s purpose.
I’m laser focused on the implementation of a circular economy, and we’re prepared to invest in waste infrastructure from plastics plants, soil washing, and anaerobic digestion, to energy recovery facilities and niche waste treatment of electronics where they will have a positive impact. Government and EPA are leading us most of the way, and with a few tweaks, we can supercharge the speed of delivery - something needed to match the demands of clients and the environment. It's up to us, the industry, to enliven and harness those opportunities.
I think there are five key areas we can all contribute to, to successfully transform our sector;
Producer responsibility - a system which drives change
It’s proven globally that good source separation from consumers and householders alone won't be enough. People have busy lives and a lot going on, so we need to design a world that combines what is obvious and convenient, with what is sustainable. This is why we advocate the need to design for recycling - create an intuitive, easy option approach, which will engage 95% of the punters. This has to be combined with honest packaging which says if it's recyclable or not. If it's not, then the only excuse we should accept is that it's a fair compromise for product protection it affords.
What we need is a systemic change that the consumer can rely on. Manufacturers, retailers, waste management, recyclers and local authorities have to act collaboratively to adopt a new way of thinking, invest in new technology, upskill the workforce, and change long adopted practices. This requires mandated producer responsibility rather than voluntary stewardship which is not scalable or reliable.
If there is one thing that’s clear, it’s that all parts of the supply chain need to be involved – from the miners, the refiners, manufacturers, retailers, consumers, local authorities, and our sector, as well as the people making feedstocks to be used back in new goods.
What happens too often is waiting for someone else to make the first move, a sense of ‘if that other part of the supply chain does something differently, then the system will work’. Everyone needs to do something differently. I admit we do, and I do. We need to step up and invest in new technologies, promote more separation, more collection, and more treatment, and produce better quality, cleaner feedstocks for reuse.
As a fair society, we could adopt a Pay As You Buy approach for products. Because when we buy something, like a takeaway coffee from a café, we are paying for nearly everything involved – the electricity to boil the water, the water itself, the picking and roasting on the beans, the barista salary, the cup it comes in. The only thing we are not paying for - bizarrely - is its recycling or disposal.
I think the consumer that's causing the waste should pay for its recycling or disposal at the point of purchase - a kind of upfront approach. Someone pays for the recycling today, it's just not the person buying the coffee, it’s councils who dispose of it. I think we can agree that this is not fair.
This notion is not a pipe dream, it’s essentially how the Container Deposit Scheme works; you put the full cost of something into the purchase price. Overall, it will be cost neutral or even more cost effective since manufacturers are involved from the get-go.
How, you ask? If you think about all the non-recyclable items in a yellow top bin, it is the local authority that is paying for that to be collected and treated. They can't do anything about the design of those products; they don't make them, which means they can't optimise the cost.
If you put the cost with the manufacturer who passes it to the consumer, the manufacturer will optimise the cost, because businesses always optimise their costs. They will design better. Therefore, we'll end up with a system that's more efficient, environmental, and less costly overall. Manufacturers who make recyclable products will automatically pay less, incentivising the systemic outcome.
Energy-from-waste
When all the dust has settled over producer responsibility there is always going to be some residual waste left over. Energy recovery has an important role to play here, and this comes from our experience of the 65 units we operate across the world.
Despite being ‘new’ to Australia, it’s not unknown technology - it’s been proven worldwide. The first one I was involved with was in central London in 1994, which still operates between two railway stations in central London supplying sustainable heat and energy to 10,000 nearby homes. The latest incarnation of this technology is more efficient, recovers more energy and materials and is certainly state of the art. Moving with the times it’s one of the cleanest forms of energy production - being carbon neutral as an added value - when compared to landfilling.
If you’re wondering how the community reacted to its development, well, it was the same reaction received everywhere - initially concern, opposition, sometimes outrage of the unknown. So we did exactly what we’re doing in Australia now for energy from waste development - we engaged.
Our policy has always been to welcome people and their questions, get them to see and understand the technology, and talk to them about their concerns. Most people understand the science behind it, but there are always minority groups who don't or won’t.
Yet, without exception, once built and operating, we’ve had no problems post construction because we continue to engage with the community until they see the proof in its safety, which we can always demonstrate. The fact is, where these units have been built, the authorities and districts who took the bold decision haven’t looked back, they are enjoying local sustainable energy and regional prosperity.
In Australia, we are on our way there. Two facilities are close to completion in Perth and others are in the pipeline on the eastern seaboard. In NSW, one of the most critical moves of the government was to promote the technology, then identify 4 locations so investors could have certainty on development, making sure the state doesn’t overinvest in too many, and leaving space for increased recycling - pretty progressive overall. The government also looked at sustainable transport routes, taking materials to dedicated rural areas which will benefit from the local investment and creating wins for everyone. This plan is bespoke for NSW and makes sense given the backdrop.
Although Energy from waste is widely known for non-recyclable waste treatment, Anaerobic Digestion (digestion of organics to make methane industrially) has been somewhat overlooked across Australia for energy recovery. Most people don’t understand that it’s a sustainable, carbon neutral biogas technology. Our studies show that if we used all the wastewater sludges, waste food and other organic sources available to us, combined with Energy from Waste we could supply 10% of Australia's energy needs. This is a real opportunity to solve the waste crisis and decarbonise at the same time.
Export
Mainland European models suggest more household waste bins are the way to go when it comes to separating waste streams, but I’m not convinced. I genuinely believe three is enough, maybe with one small bin for food in cities. I think we just need to be practical, no one wants 5 bins at their home, and with urban infill and more multi unit dwellings in our cities, we can't actually accommodate multiple bins.
From a processing point of view, I know the reuse sector would be happy to see 10 separate bins. You’d have nice clean glass, clean PET, and much more, but the fact is that collections have to be simple for the consumer and more collections are more expensive. I think a more realistic scenario is a balance between the ideal quality, and making it as easy as possible for the consumer. The one commingled bin makes sense, as long as everything put in it has an end market.
Ultimately the ability to export is fundamental for a proper sustainable circular economy. Without that it would be akin to banning the import of overseas alternatives for products, it would cause the price to rocket. In the case of saleable recyclable commodities, banning export will lead to price restrictions since the outlets are limited. This can easily be fixed with flexible export quality exemptions geared to overseas market norms. 99% of this material is going to suitable, permitted facilities today, overseas, and there is no reason that we should not continue if we wish to preserve recycling levels and local authority budgets from new pressures.
Landfill levies
There is no stick to be swung if policies are not implemented without a sting in their tail - and today some policies just don't have a sufficient bite in them. It might not be a popular opinion, but increased landfill levies as a way to encourage more waste away from landfills is a sensible way forward, particularly if we align state levy price points.
The FOGO policy could do with a bigger stick. It requires that by 2025 we need to do FOGO, but if you don't meet those targets, I'm not sure what, if anything, will happen. Whilst there is certainly merit and some flexibility here for MBT to persist where there are suitable end beneficial uses, we also need to supercharge FOGO. The power of the levy is the same the world over. Levies help to drive everything away from landfill. It works and it should be normalised federally, state by state, region by region, and slowly escalate to avoid impacts on business and households and until landfill is declining. This state harmonisation of regulatory levers is critical not only for levy but for ERF regulation, recycling and compost quality, and end of waste status - and this could be a high value contribution from the Feds.
EPA
The EPA plays one of the most important roles of our sector. Its people like the NSW EPA CEO Tony Chappel are redefining the way we collaborate, which is such a refreshing new approach.
Our sector hasn’t done the best job of collaboration and co-designing solutions with the EPAs of the past, and we have been fighting them for too long. Just because they are there to regulate what we're doing doesn't mean we can't work with them to design product stewardship schemes, solar panels, batteries and electronic equipment recycling legislation. We are trying to get to the same end game, so why can't we team up?
I think we have a visionary EPA in New South Wales that really wants to make a difference and I don't think we're helping them enough. I'm all about finding ways to co-design the circular economy with the EPA and I think there's power in working together.
Moving forward
So three years since my arrival, how is the industry tracking for the future?
We're on the precipice of making the decision to really get on with it. We've just seen the IPCC Survival Guide for Humanity report that confirms again that we have no time left to quibble about this. We’ve also just seen the net zero australia report on the energy transition required, and among other things, we need to recycle more, FOGO more, treat more, recover more energy. As advocates for real progress like Mike Ritchie from MRA often remind us, landfill levies do work, recycling does get recycled and we all need to bite off more than we can chew if we want to get to 80% any day soon.
Australia's Net Zero report, which is requiring trillions of dollars of investment over the next few years, requires us to responsibly mine and manufacture our way out of this and I want to really step up the game in our sector to help our customers. We’ve got huge scope to improve, because we haven't done everything yet. I think it's all in play for us and we've got a government and an EPA that want to do it too, so as an industry we just need to stand up and build the future alongside them.
One thing I quickly learnt when I arrived here was that Australians are brave, fair, and really good at getting things done, once the decision is made. So now that the decisions are being made, there’s nothing to hold us back. They say there are old garbos, and there are bold garbos, but there are no old bold garbos. Well, it's time for all of us old garbos, myself included, to change that and be more bold.
By Richard Kirkman
CEO of Veolia Australia & New Zealand
Circular Economy Ph.D., Imperial College.