Big opportunities for firms to clean up

THE North East could be missing an economic trick by dragging its heels when it comes to recycling and waste disposal, but moves to improve our performance could create significant business opportunities.

WHERE there's muck there's brass appears to be one cliche that has a ring of truth in our increasingly environmentally conscious world.

There is money to be made in recycling and reprocessing rubbish and demand for services is set to increase as the Government raises the bar on how much waste must be diverted from landfill.

But the region is not making the most of these opportunities, according to WRAP (Waste Resources & Action Programme), the Government-funded not-for-profit company that works with businesses, councils and individuals to reduce waste and encourage recycling.

“For the most part, the North East is currently missing out on a potential revenue stream because the recycling and reprocessing industry in the region is not as developed compared to some other areas of the UK,” said WRAP’s regional business adviser Richard Harris.

“Landfill is still a significant means of waste disposal within the region, and there aren’t enough recycling and reprocessing companies to deal with the recyclable waste being generated.

“The relative lack of recycling capacity has meant that much of the material collected for recycling in the North East leaves the region for reprocessing in other parts of the country.” There are two major reasons why the North East should raise its game. The landfill tax - the UK’s first environmental tax, introduced in 1996 – is increasing at £8 a tonne on April 1 every year until 2013 and reaches £48 a tonne next year. And there is also money to be made from the reprocessed materials that come out the other side.

Mr Harris said: “All recyclable materials have a potential value, but the recycling industry is at its most profitable when items of waste, such as glass, paper and plastics, are processed into secondary raw materials that can be used to make new products. Recycled materials are increasingly popular with manufacturers as an alternative to expensive new raw materials.

“Because of the potential business benefits associated with recycling waste generated locally, an increasing number of waste management companies in the North East are now looking at the options available to develop their businesses.”

The North East’s mining heritage means the region still has space for landfill compared with elsewhere , according to the Environment Agency (EA). In the past, this has been the cheap and easy option for getting rid of rubbish.

That has contributed to the region’s comparatively poor performance on recycling: EA figures for 2007-8 show that the English average for recycled household waste was 34.5%; the North East achieved 28.4% – the lowest in England apart from London. The national target is 40% for next year. These figures refer to household rather than commercial and industrial waste. Business rubbish figures are hard to quantify because not all waste produced in one area stays there, so waste from the North East could be disposed of in another region and vice versa.

One North East’s environment senior specialist Ray Waters said: “The big difference between municipal waste – where there is a lot of information – and commercial and industrial waste is the way it is collected and treated.

“It can be quite difficult to quantify where it [business waste] ends up. Back in 2002/3 was the last time the Environment Agency took a nationwide survey on industrial and commercial waste and we are still relying on that data. In the region, we are now undertaking a survey of commercial and industrial waste.”

It is essential, he says, that this sort of data is available to give businesses information about potential openings.

“We can then say to potential investors, these are the business opportunities that could be around that waste material – for example plastics recycling – is it worth doing it in the North East and where could we do it? It helps them to make a decision.”

The information will be available later this year and ONE, through the Renew project, is also contributing to Defra national research.

The recycling and reprocessing sector is poised for high growth as the rising landfill tax forces waste producers to find other ways of disposing of their rubbish.

“Prior to the landfill tax moving up, there hasn’t been the incentivisation to move away from landfill,” said Mr Waters. “That is changing and companies are seeing other potential benefits of moving into new treatment technologies.

“We’re hoping they’ll be more technologically advanced and we will produce higher value products or resources, for example heat and power through incineration or by advanced processing – biochemical treatment processes.”

He believes those that will thrive in this new economy will be newer, innovative companies prepared to diversify. “Older companies are not as fast because they have still got a fair amount of space available for landfilling. They are not having to respond as quickly,” he said.

“We will see a good amount of innovation in the region, particularly around bioprocessing. We had the recent announcement of a £12m funding into the industrial biotechnology plant at CPI (the Centre for Process Innovation) at Wilton, which will enable them to look at bioprocessing.”

And he says the region can become a leader in these new technologies. “We’re stealing a bit of a march on some areas. We’ve got some exciting things starting to happen – some good things are taking place.”

WRAP AND RENEW

THE Renew Project and WRAP both support businesses interested in waste reprocessing and recycling.

Renew, set up by The Centre for Process Innovation (CPI) on Teesside as an energy and environmental technology sector project, works with organisations from SMEs to heavy industry to develop low-carbon ideas.

It can support businesses looking at new technologies and help them make the case to raise finance to put their innovations into practice.

WRAP, funded by the government, concentrates on SMEs. It offers free business development support, from planning to sales and marketing and organises the Recycle Now campaign for England. More information on WRAP is available at www.wrap.org.uk and Renew at www.renew-cpi.com.

GRAPHITE RESOURCES

THE region already has a global leader in reprocessing rubbish in the form of Graphite Resources, which is building the world’s biggest autoclaving plant in Gateshead.

The 125-tonne autoclaves are due to open at £50m Derwenthaugh EcoPark in the autumn, and when fully operational will be able to treat 320,000 tonnes of household and non-hazardous business waste annually.

Graphite Resources director Michael Thompson said: “There is ever growing pressure because of the landfill tax; this is an industry created by legislation.As landfill tax gets ever more expensive, other solutions need to be found.”

Autoclaving uses steam to create high temperatures to sterilise waste so the component parts can be reused.

“Typically, we will recover in excess of 80% of the waste stream, then it will either be recycled into its original form – plastic into plastic, metal to metal, glass to glass – or the organic content reduced to cellulose fibre material which we call ‘cellmat’.

“It can then be anaerobically digested and converted to gas and fed back into the gas grid.”

Graphite Resources is also looking at technology to convert the waste into biofuels for use in transport.

Mr Thompson is confident there will be significant business opportunities for the North East.

“Once we are up and running, then the region will probably be further ahead than other regions if local authorities are minded to take up the opportunities.”

ALEX SMILES

STARTING life in 1973 as a scrap business, then moving into waste during the pit closure programme, Sunderland company Alex Smiles now primarily sorts and recycles business and municipal rubbish.

Stuart Smiles, whose father set up the firm, says that although organisations do look to operate in a more environmentally-friendly way, law and the bottom line are forcing more to think green. “The pressures from the Government are in lots of different ways. The landfill tax is essentially quite a lot. That’s really taking the prices up, so economically it costs much more money each year to do the same thing.”

Although there are business opportunities, he is concerned the cost of startiing can be prohibitive. “The difficulty is that you have to do it properly and you need lots and lots of money. We’ve spent our money on a new recycling plant, but you could always do more if you had an unlimited cheque book.”

He said: “There are lots of small benefits you can do that are incremental, lots of little things add up.”

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