Consultations 2021: Planning and managing the necessary transitions

This blog seeks to capture the outputs of a deep-dive workshop session that I ran for our customers. Seeking to place the EPR and DRS objectives into actions and sequences that helped us understand the scope and journey of the necessary transition from where we are, to where we need to be. The interactive session used ‘write on screen’ techniques to capture conversations, ideas and comments that helped structure thinking and brainstorm issues and solutions.

The last big transition the sector went through was the introduction of landfill tax in 1995 and we used this to track the actions and impacts that resulted in the management of the transition from landfill to recycling and recovery. In analysing what happened in landfill, we were able to match the thinking required to understand what is likely to happen with the introduction of EPR and DRS.

The introduction of the landfill tax was a significant change as a concept, but the manner of its use, the escalators applied at different times and the schemes and programs introduced to assist the transition, like Landfill Allowance Trading scheme (LATs), in-vessel composting and MBT, clearly show what worked well and what worked less well. The transition process included a great many factors, including: cost, political landscape at a national and local level, developing the understanding that EFW was an acceptable alternative, public peer pressure over environmental concerns and risks, the business case for making changes and the timetable to do so, the potential fines for not making changes, location factors and a lack of local facilities, planning for changes across 2-3 year or 5-10 year windows, and the time and resources to make the changes.

With the LATs scheme launched at the same time and designed to “enable the UK to meet the Landfill Directive targets of reducing the amount of biodegradable municipal waste (BMW) being sent to landfill in a cost effective way. Reducing the amount of BMW going to landfill will reduce the amount of landfill gas released into the atmosphere and help protect the environment”¹.

Adjusting to this radical policy reform required the entire sector to reassess what they did and how they did it, to understand what they needed to deliver and how they could deliver it, and required a mix of technical, project management, commercial and social skills and insights.

Having compiled this considerable list of factors it was obvious that many of the delegates were comforted with the clarity the process had given them, whilst others had already moved on to apply the same thinking to the transition for EPR and DRS. Concerned by the significant impact that these pending changes would have and the amount of early planning and management that was now required was palpable, but also manageable when broken down into steps and sequences.

Allowing sufficient time to plan properly for this long journey is essential and needs to be started now, with changes impacting businesses by 2024-2025, and municipal organisations with core materials introduced from 2023/4. It was advised that changes to infrastructure may take anything from 2-3 years for the simpler alterations (such as new sorting lines at the MRF), or as long as 5-10 years for the bigger, more complex developments (such as new reprocessing facilities). It is also worth noting that many organisations may find themselves only one budget year away from accounting for some of these changes, so planning for them should very much be on the agenda today.

Factors of transition

Understanding how the previous change was managed enabled the group an appreciation of the myriad of inter-connected factors that will be active through this time as we look to revolutionise packaging collection and reprocessing amongst other key material streams. The possible implications on current operations were considered in breakout groups whilst we also discussed the scale and speed of the changes expected.

Discussions included: changing composition of wastes coming into the system at different points, the time taken on rounds and in processing facilities, new recycling targets, current capacities at different treatment facilities, commodity markets on a value and capacity basis, the roles responsibilities and key players in the system, and whether some producers could move to increase the collection of their own materials via backhaul and offset their obligations.

Beyond operational impacts, there will also be financial implications that need careful consideration, which required an understanding of the cost points in current processes and future systems. These could include: type of collection service, changing waste composition analysis, management of data and its use, resourcing including staff and systems, the cost of the planning process itself, materials processing and reprocessing, effective communications, logistics such as collection round changes and the physical movement of materials, new bins, necessary infrastructure changes at bulking points, potential retro-fitting of MRFs, the cost of any legal expertise for contract changes, amendments to permits, plus any labelling requirements. All of these will need to be considered for municipal, business and commercial waste streams.

Understanding the current landscape gives you a basis of information to work from which will help to inform future decisions and forecast the impact of the proposals. By using one business waste customer as an example in the session, the workshop enabled the delegates to map how the planned reforms might impact at a local level. The business in question has a zero to landfill policy with commingled collections with most materials proposed for core included. As a group we considered what might need to change to meet the demands of DRS and EPR reforms, plus consistent collections and how the current services might need to be changed. How would the contract accurately reflect and share the EPR payment for their target packaging recyclables? how could the minimum acceptable quality standard be applied and met, and at what cost? Communication to explain changes in service to all its customers became a huge concern for all given the scale of change and habit changes required. In this particular example, their current contract ends in 2022, which presents another set of challenges as the new contract will have to cover (or include the flexibility to accommodate) the expected changes in the regulations, due early 2022. Planning for transition is possible, essential and a fundamental part of understanding and feeding back into the consultation documents.

Rate of change

All local authorities have been modelled under different scenarios by SUEZ recycling and recovery to explore when LA’s are most likely to adopt the requirements of the new regulations. This model has been based on assessments of each local authority across England and takes into account their contract status, fleet churn, and a number of DNA factors. The model assumes that Direct Service Organisations convert by 2026 (the peak year in transitions) apart from deprived inner city areas that will transition more slowly, and it is important to understand this because it can help us to plan better as a sector. Some will innovate early as contracts are due to end, others will delay as they are achieving high performance and their existing contract has many years to run.

If all local authorities changed in the same year, the transition would not be manageable so designing a transition that is both practical but ambitious is essential for the changes proposed.

There may also be an impact on the roles of some facilities, as how materials are collected will influence how they are managed, which in turn dictates the types of facilities you run downstream – in particular, some materials being part-sorted at kerbside may go to revised transfer stations rather than MRFs in the future. The collection systems in place will also impact the payment mechanisms the local authority is subjected to, along with the targets or expectations for tonnes of packaging collected, which may see bonuses applied if you are delivering above targets. Those performing consistently below would be offered support payments to aid the funding of necessary communications or changes.

With the introduction of packaging EPR, the materials collected at kerbside are expected to change, impacting the composition of waste and recycling materials, whilst DRS could remove many of the cleaner, more valuable materials and consumer iconic materials from kerbside schemes. Material and format changes are also expected in what is placed on the market and purchased by consumers, further impacting what is collected at kerbside, the value of materials and potentially service design. One example given was a potential move to cardboard beverage ‘cans’ which, if introduced, could replace aluminium cans and fall out of DRS and into EPR. This could be seen as making the consumer journey easier as cardboard beverage cans avoids any need of re-vending through a DRS system.

When assessing the potential impact of DRS and EPR being implemented together, a number of key considerations were raised around space on trucks, handling capacity, treatment facility capacity and ‘binfrastructure’ (is the size and cost of each bin justified should the DRS items be taken out?). By understanding the current composition of your materials, you can assess the potential impact of those core packaging items being paid for by the system, and also those which may be lost to the DRS system. This allows collection, handling and sorting to be understood not only today but also into the future, allowing a transition in materials to be mapped.

Have your say!

By understanding the transition and how it will work in your local situation, you may take a different position on the consultation questions and your response. We would advise everyone, just as we have done with our customers through these deep-dive workshops, that completing this type of workflow assessment for your organisation is a worthwhile step in the consultation process and needs to be completed ASAP.

By auditing your costs, knowing your material flows and the percentage of the materials that will fall under obligated and DRS systems you will gain a clearer picture of the impact of the proposed systems while also demonstrating where you may need to consider new services and material flows, and how you may need to manage those, too. A clear timeline of your contracts and asset lives will also help you to draw a fuller picture and get a clearer view of your organisation’s timeline for transition.

The only constant is change, and with so many changes facing our sector, planning for transition is critical and starting this early to inform your consultation response is key.

Reference: ¹https://www.ciwm.co.uk/ciwm/knowledge/landfill-allowance-trading-scheme.aspx