Select Committee on Environment, Food and Rural Affairs Minutes of Evidence

Examination of Witnesses (Questions 360 - 379)



  360. There is something peculiar going off here, because the Minister told us yesterday that it was the market that would operate, and the market would find a way, and this was a private sector operation, and you would see the light and show us how to do it?
  (Mr Hazell) Of course, the market will operate if the framework for that market operation is set; but waste is, in a sense, a distress purchase. I do not imagine that any member of this Committee spends his quality time going round at the weekend looking for waste to buy. People want to get rid of their waste in the cheapest way the law allows, and sometimes, unfortunately, in ways that the law does not allow. So if you want to build a hazardous waste infrastructure it has got to be driven by regulation, and the Government has got to set a strategy within the European framework; and that, we would submit, they are signally failing to do.

Mr Borrow

  361. Can I just pick up that last point, before I deal with something I was going to pick up. Would you regard the Government being more clear on regulation as being a strategy, or how do you see clear regulation and a strategy going together; you seem to interchange between the two, I was not quite sure whether you see a strategy as something separate from the Government being clear what regulations he wants to see enforced?
  (Mr Hazell) The Government has got to say what outcomes it wants to achieve. We are very clear, and I have to say that we are sometimes brought into the turf war between the Agency and the Government, and we would actually prefer, we want the Agency to be very well resourced to do its core regulatory function, we do not really think we need yet another green NGO, but we want the Agency to focus on that, and we want the Government to govern. We have not got any signals about the strategy; and Leslie can certainly give you examples of imminent issues, in the next two weeks, where we do not actually know what the regulatory framework is going to be. Do you want to comment?
  (Ms Heasman) Yes; if I could follow up on that. One of the bottom lines of a strategy is to set out the dates and the criteria which are to be met, and then you go on to discuss how best they can be met. In 14 days' time, hazardous liquids will be banned from landfill; we still do not have an agreed definition of what a liquid is. In 14 days' time, corrosive hazardous waste will be banned from landfill; we do not have an agreed definition of what corrosive is, in terms of what will be banned and where the line will be drawn. We do not have a date on when the Acceptance Criteria for hazardous waste will be brought in; we do not have a date on when the Acceptance Criteria for non-hazardous waste will be brought in. We do not have a date on when the pre-treatment requirements for non-hazardous waste will be brought in; we do not know what the Acceptance Criteria are. We have been told, as Mr Hazell has mentioned, that the draft Criteria were not going to change much, the industry should go ahead and invest, and, lo and behold, to the surprise of the Agency and, indeed, of DEFRA, to the surprise of everybody, these standards, indeed, changed in the draft decision document last week. There are huge additional uncertainties in interpretation, in ambiguity, in the wording of the Directive, which has been transposed, almost verbatim, into the Landfill Regulations, for obvious, understandable reasons of minimising infraction proceedings. But alongside that what is absolutely necessary, and has been asked for, for many, many months, is some decision on how these ambiguities are going to be interpreted, what the policy is on what the meaning is going to be, of each of those aspects of the Directive; and there is huge confusion out there. And these are issues that are going to begin to bite in 14 days' time, there is going to be an absolutely crucial decision period in 2004, and if we do not know now what the answers to these things are the industry is not able to make decisions on what to spend these amounts of money.
  (Mr Hazell) Can I ask how that affects Cleanaway, in terms of the immediate future?
  (Ms Weeks) I think Leslie has more or less set it out. You cannot go to your shareholders and ask them for vast amounts of money, because most of the hazardous waste infrastructure facilities will cost in the millions of pounds to set up, you cannot go there and ask for those kinds of resources, unless you can actually put forward a business plan, saying that, "If you give me this amount of money, I will get this amount of waste in over a period of time." The UK waste management industry is in private hands, and it is no embarrassment to say, yes, we have to make a profit, so we need to know where the waste is coming from and we need to know that, if we build the facility, waste will be directed towards it, and not be allowed to go to the cheapest legal option down the road.

  362. I wonder if you could elaborate a little bit more on the perceived turf war between the Environment Agency and DEFRA?
  (Mr Hazell) We always resist invitations to get involved; but the Agency—


  363. Do not resist too hard here, this is the time to tell us; you have wetted our appetite now, on this?
  (Mr Hazell) What I would preface my comments by saying is that, with the appointment of the current Chairman and current Chief Executive of the Agency, the rhetoric that is applied towards our industry has vastly improved, and there is a much greater realism, and at personal levels we have quite good relationships with some officers of the Agency. But, particularly when relevant skills are so scarce in officialdom, we really do need certainty about who is supposed to be doing what; and there is an uncertain boundary, in our perception, about who is driving waste policy. And ESA's position has been a very, very consistent one, it is difficult really to go too far beyond it, which is that the Government should govern by setting the strategic policy, should set the law, and then it is for the Agency to apply the law. And I would just offer the thought that it creates perhaps unnecessary complexity when the Agency start making expressions of views on policy, particularly when they conflict with the policies of the Government, where those policies happen to exist. So we do need a bit more focus, and we certainly need, from our point of view, much more engagement, in a much more detailed way, with DEFRA officials; as I said, I do not think that the Sixth Environmental Action Programme has ever been discussed with us, in a context where there is co-decision with the European Parliament, and, as you know, a strong Environment Committee in the European Parliament, with a British Chairman. It cannot make sense for DEFRA to fail to discuss with us the long-term strategy at the European level, because, sooner or later, it is going to hit home here. So I am going to resist the temptation, I think, to get too specific, if I may, because I think one starts to get into personalities; that is not very helpful. But I think it is pretty clear, from public statements made by the Agency, that they have policy-making aspirations, and we would resist that.

  364. Could you possibly find one or two examples; if there are written and publicly available differences, it would be very helpful for us, at your earliest convenience, to have some examples of those?
  (Mr Hazell) Yes, we will do that.

  365. I wonder if I could just go back to Ms Heasman's evidence. I just wanted again to take an understanding in an area which I still find complicated; but you were making it very clear, in your list of criteria, as yet undefined, that there were going to be problems. Am I right in thinking that, against that background, by 16 July, people are going to have to decide whether or not they are going to be in the hazardous or non-hazardous waste business, in terms of landfill sites?
  (Ms Heasman) Yes; the decision needs to be made and the documents submitted by 16 July at the latest, the Site Conditioning Plan, where the site operator determines whether or not they wish to be hazardous.

  366. Just to be clear, and this is a matter of fact, that decision is going to have to be taken by companies against a background that, if we had the Heasman list here, of the ill-defined or undefined, they are going to make a decision about what they want to do on their landfill sites, whether they become a mono-site for hazardous waste or they stay in the field of non-hazardous disposal, against a background where there are not clear definitions of exactly what it is they are actually going to have to deal with?
  (Ms Heasman) That is absolutely right. Just to confuse it slightly further, there is one choice that they can put off for another two years; they can opt to be, what is being called, an interim hazardous site, between the period 2002 and 2004, and then at 2004 they must make the final decision on whether they are going to go back to being a non-hazardous site or remain as a hazardous site.

  367. Again, if I have understood correctly, what you are saying is that we could have a situation, because of this evolving policy, that materials would be put into hazardous waste sites, in such a way that we are not quite clear what happens to them in the future, there are liability issues which are as yet undefined, because of this lack of clear definitions; so there is really a sort of growing recipe for uncertainty, both in terms of the physical security, the degradation of the material, as well as the legal liabilities?
  (Ms Heasman) That is correct, yes.

Mr Mitchell

  368. And that means, presumably, that people are not going to want sites designated as hazardous, because it is going to be a long-term problem, like a run-down nuclear power site, or something, there is going to be leachate pouring out all over the place, and people do not want that kind of problem?
  (Ms Heasman) The problem is not leachate pouring out all over the place; the problem is the investment and the infrastructure necessary to collect and treat that leachate in the long term.

  369. But your evidence says, you are saying, so far as I hear it, that if it is a mixed site, you have got hazardous and non-hazardous waste all jumbled together, there is some biological, or whatever it is, interaction, which makes the hazardous waste safer, right; that does not occur if it is just hazardous waste?
  (Ms Heasman) That is correct.

  370. So it is more of a long-term problem?
  (Ms Heasman) It is a long-term problem. If the waste is treated to meet the Waste Acceptance Criteria before it is landfilled then that problem is lessened. The particularly difficult period, which is not acceptable, is if co-disposal is banned on the date that is set in the Directive, which is `04, and the Acceptance Criteria are not brought in at exactly the same time.

  371. And treatment is not required?
  (Ms Heasman) Exactly; in the interim period, yes.

  372. But the uncertainty about this could well mean that we will not have the number of hazardous waste sites that we need; is that the problem?
  (Ms Heasman) That is certainly a very likely problem. You must also remember that there are opportunities for non-hazardous waste sites to accept stable, non-reactive hazardous wastes that have been subject to an even greater level of treatment than those that can go into hazardous waste sites. So it is not that there is no route for hazardous waste disposal, it is a different route, and more stringent treatment criteria will apply.

  373. So is there a danger that, if this is not decided, there is landfill disposal of untreated hazardous waste?
  (Ms Heasman) I do not think that will be acceptable to anybody.

  374. But is there a danger that that will happen, if there is not a requirement to treat it?
  (Ms Heasman) I do not think the Agency will permit that to happen, because the risk assessments would not permit that to happen.

Paddy Tipping

  375. But there could be a shortage of facilities?
  (Ms Heasman) Indeed, there could be a shortage of facilities, which would require, potentially, storage until the treatment facilities were available.

  376. And the facilities could be patchy all over the country, because there is no national strategy?
  (Ms Heasman) Exactly.

Mr Mitchell

  377. I want to be clear in my mind on the question of self-interest. What you are saying, when you are saying "We're all alone in the world and the Department doesn't consult us and they wont talk to us, and we're getting such a chilly reception, we've got to go back and huddle round our incinerators to get warmed up again," is that your self-interest is a more high profile industry, the firms do business in Europe as well as here, they want that level of standards, and that level of investment, that level of power, you want to aggrandise your industry. Whereas you are accusing the Department of wanting a cheap-jack industry, which they might interpret as a lower burden of costs on British industry generally. Is that the essence of the self-interest on both sides, or am I being unfair, as usual?
  (Mr Hazell) I am not accusing DEFRA of wanting to continue with the cheapest possible arrangements they think the law will allow; we simply do not know, and the PIU has yet to report, and, as far as the municipal waste stream is concerned, the current public sector spending round has yet to be announced, so we simply do not know. And what I am trying to signal, as clearly as I can, is that what the industry desperately needs is certainty; and once we have certainty about the types of outcomes the Government wishes to achieve, our members can then start to consider what type of infrastructure it is appropriate to invest in. The reality is that the European Union, as an entity, is trying to drive forward environmental standards in a particular way for the European economy, which is pretty well the largest in the world, as you know, and the overriding priority for the European Union is to try to tackle global warming, and the second priority is to try to deal with waste management. And various components of the Sixth Environmental Action Programme then, the resource use and the recycling component particularly, deal with our sector. So we are looking at a restructuring of the economy, which, whatever happens, will increase the amount that is spent on environmental services; we are about half a per cent of GDP at the moment, if you take The Netherlands, it is about one and a half per cent of GDP, and we think, probably, if you get up to about 1 per cent of GDP here, you have got broadly the right outcome for this industry. So, of course, there is selfinterest, but self-interest can be very enlightened. I think, with the greatest respect to you, when you go to your voters, you put forward a package that you think will be attractive and in their interest and in yours, and that is, I think, a very good analogy with what this industry is trying to do. But we are also being, I think, very, very responsible in what we are saying as an industry about untreated hazardous waste going to mono-landfill. And there is another analogy that you could use, it is not perfect, but it is to say that, if you, as Parliament, decided you wanted to change the side of the road on which people drive in this country, you have got to have one day on which you do it, you cannot just let everybody do it at their own speed, because you will get unfortunate results. So we are trying to be responsible, but, I think, in a context where so much of the investment in infrastructure has yet to be made, you probably have more reason for trusting our motives than you would with a sector that already had a great deal of infrastructure in place; because the reality is there is a shortfall, and, as Ernst & Young said, I think it is, six to seven billion of infrastructure, and it is obvious, when you look at the rest of the European Union. So we can go whichever way the Government sends us, but we just need to be told.

  Mr Mitchell: I accept that, I am not arguing that, there is virtue in getting up to European standards, certainly. Can I turn to Gill Weeks now. I did not have the pleasure of visiting your high temperature incinerator, which has so enthused the Chairman that he seems to want to spend the rest of his career as close to it as possible.

  Chairman: I have got plenty of rubbish in my office to get rid of.

Mr Mitchell

  378. It has obviously been an impressive experience. I could not come because there was a Mayor-making in Grimsby, where we do not use high temperature incineration. But, as I understand it, the cement industry uses waste as a kind of substitute fuel, and that is classified as recovery, whereas the high temperature incinerators are classified as disposal. Now you want, I take it, more of the material classified as recovery status going to high temperature incineration; so what is the future of high temperature incineration?
  (Ms Weeks) At this particular moment in time, the future of high temperature incineration is bleak, really; we have gone from four merchant plants down to two, so the UK has just the two plants, one up in Ellesmere Port and one down in Fawley; and this is substantially less hazardous waste incineration capacity than is available in most other similar Member States. And the reason for that, we believe, is because the hazardous waste in those Member States is being more directed, so, again, the strategy of those countries is saying that certain wastes are suitable for blending, certain wastes must be incinerated. The market is being totally skewed, at the moment, because we are getting hit from all sides in the hazardous waste incineration market; we are not being afforded recovery status, so the customer who produces the waste has a driver, because of Government policy and strategy, which is quite correct, to say that he should recycle or recover more of his waste, rather than dispose of it, so that is pushing waste towards the cement kilns and away from the hazardous waste incineration. So even if we take our prices down to the cost of the cement kilns, blending, the customers are saying, "Well, we'd still rather send it to the cement kilns because we get more points on our EMAS score." Now we feel particularly aggrieved about that, obviously, because we have to have a lot of back-end clean-up on our incineration plant, we have to have the plant complying in all respects with the Waste Incineration Directive, so the wastes are moving in that way. The other issue is that waste can be blended, so something with a very low CV, or with a high metal content, can be blended into the clean waste streams, and that producer still gets recovery status as well. And one of the earlier Select Committees, one of their recommendations was that the Government or the Agency should draw up a list of wastes which were, I cannot remember whether it was more suitable or not suitable to go to cement kilns, but, in other words, directing-waste in the right way. And I think this comes back really to what we are asking for in a strategy is, quite simply, does the UK Government want high temperature incineration for the future; because if it does then we need to have wastes coming in our way, the market alone will not deliver, because it will always be cheaper to blend waste and burn it in a cement kiln than it will to burn it in a hazardous waste incinerator, just simply because of the technology employed. And you have to remember that in the cement industry it is replacing coal, so they are paying for coal and then replacing that with wastes that they get paid to take; so the net gain to the cement industry is quite significant. We do not have that; we may have to burn fossil fuel in order to burn the more hazardous wastes, if we cannot keep getting the high calorific value.

  379. But you recover energy from high calorific value waste?
  (Ms Weeks) We use the high calorific value energy in our plant to burn the wastes which are the most hazardous.

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2002
Prepared 26 July 2002