Bringing EfW Under the ETS from 2028: What You Can Do Now

Confirmation that Energy from Waste (EfW) and incineration plants will be covered by the Emissions Trading Scheme (ETS) from 2028 has sounded a warning bell for waste handlers.

With the expectation of increasing gate fees and price hikes being passed to customers, waste handlers will need other disposal routes or processing methods, particularly for waste that can’t be recycled.

Dr Stephen Wise is the Chief Strategic Development Officer of Advetec, a biotechnology business focused on extracting greater value from unrecyclable waste. He said: “Taxation like the ETS is part of the Government’s move to drive further waste segregation and set to be as ground-breaking as the introduction of landfill tax in 1996. Despite constant debate in the industry about who should bear the cost of the ETS tax, EfW operators seem very comfortable in their current position, suggesting it’s their customers who will shoulder the burden via increased gate prices.

“The waste industry giants can negotiate better prices and build the infrastructure to stay competitive even when the gate prices rise by £40 per tonne, but what about the independent regional companies? Will they be able to absorb the cost to stay competitive? The likely answer is no. As a result, we expect this tax to encourage more waste handlers to embrace new offtake routes and waste innovation so they can reduce operating costs, gain a competitive edge and grow profit margins.”

While some waste handlers may choose ‘business as normal’ until nearer the 2028 deadline, those who act now will feel the most significant gains, according to Stephen. He said: “Not only will waste handlers unlock cost and carbon savings now, but they’ll also have disposal routes confirmed well ahead of time, offering extra reassurance to their customers.”

The latter is significant, especially against a landscape of legislative change. Stephen continued: “There’s already a marked push towards Net Zero, and many businesses now have to report on Scope 3 emissions, which means they want to know their waste is creating as few carbon emissions as possible. These businesses need to know the exact tonnage of their waste and its associated emissions and have identified a path for future reduction and diversion. Waste handlers have to be able and willing to provide that data.

“We also must consider the government‘s pledge to halve the biodegradable waste sent to landfill by 2028 and the rising cost of waste exports, largely due to the implementation of ETS in Europe ahead of the UK. Waste handlers must look to sustainable innovation to protect and grow their profit margins.”

Cement production is one industry keen to reduce its carbon footprint and has been part of the ETS for some time. One way to do this is by powering kilns with biogenic carbon-rich Solid Recovered Fuel derived from unrecyclable waste.

Stephen said: “Cement producers have been steadily increasing their use of Solid Recovered Fuel in recent years as it helps to lower their ETS tax burden without compromising the quality of the combustibles they use. These producers are looking for two things in SRF. The first is a high calorific value, so the kilns achieve the right temperature, which comes from the plastic component of the fuel. The second is a high proportion of biogenic carbon to lower their ETS tax burden, which comes from the organic matter in the SRF. As a result, high-quality SRF, which is rich in biogenic carbon, is highly sought after.”

Historically, waste handlers have required expensive plants and infrastructure to create SRF. However, Advetec’s biotechnology allows smaller regional waste handlers to access this offtake route and create SRF on their own sites without onerous financial implications.

Advetec’s solution opens up a much more comprehensive array of options for waste handlers because it:

· Increases the biogenic carbon fraction of unrecyclable waste - which is not subject to ETS tax

· Stabilises waste so it can’t break down further

· Dries waste it so it can be separated and recycled if so required

· Converts it into SRF, a commodity which can be offloaded at much lower prices than landfill or EfW.

Stephen concluded: “With businesses under increasing pressure to address their environmental impact, technology that unlocks the potential of biogenic carbon will be critical. Through waste-derived SRF, Advetec offers energy-intensive industries a genuine alternative to traditional processes. It brings choice to waste handlers and helps to support more circular ways of thinking by reducing waste, protecting the environment, and improving businesses’ bottom lines. And that’s something we can all get behind.”

Join us on February 28th for a webinar with Materials Recycling World as we give voice to waste handlers and deep dive into the implications of bringing EfW under the ETS. The webinar panel will discuss the impetus for greater waste innovation, the technologies that could help and how to remove the barriers to adoption.

Our speakers include:

Colin Church , Chief Executive Officer of The Institute of Materials, Minerals and Mining (IOM3)

Sam Riggs , Specialist Environmental and Regulatory Defence Barrister, MCIWM of 25 Bedford Row

Advetec’s Chief Strategic Development Officer, Stephen Wise .

Register for ‘The Emissions Trading Scheme for Energy from Waste: Examining the Impact on Independent Waste Operators’ webinar: Webinar Registration - Zoom