House of Lords - Science and Technology

Select Committee on Science and Technology Sixth Report

CHAPTER 4: MANUFACTURING, CONSTRUCTION AND THE IMPACT OF DOWNSTREAM FACTORS

4.1. Design undoubtedly plays a large role in determining the amount of waste a product or building will generate throughout its life, but this should not preclude consideration of other aspects of the life-cycle. Forum for the Future commented that "all waste reduction problems are not design problems" and other downstream factors will play different roles according to the specific waste stream (p 468). Professor Grimes from Imperial College London agreed that design alone "is unlikely to achieve sustainability without the involvement of experts from the fields of material science and waste treatment for optimum recovery" (p 315). Whilst new technologies, changes to production processes and innovative solutions to meet consumer needs can all play a significant role in reducing waste, conversely a lack of knowledge, poor business guidance and burdensome regulation can impede efforts to reduce waste during manufacturing and construction projects.

Waste reduction techniques

4.2. A range of design and manufacturing approaches have been developed in recent years to improve resource efficiency. Lean manufacturing is a codified system which identifies those things which add value to the manufacture of a product and systematically eliminates those which do not. Toyota is a famous exponent of this system and uses it to attack all forms of "waste," including wastes of time, labour, materials and other factors. The six sigma approach is a related system which identifies and removes the causes of defects and errors in manufacturing, using trained personnel and statistical tools. As these approaches focus on improving efficiency and maximising profits they have brought the costs of waste to the attention of some businesses, with Dr Michael Pitts, Priorities Manager at the Chemistry Innovation Knowledge Transfer Network (CIKTN), noting that they had "a huge influence" on waste reduction (Q 259). Another useful strategy is benchmarking, in which businesses evaluate their processes against best practice and then alter their practices to try to improve. This can be a one-off comparison but is usually a continuous process where companies constantly alter their practices in an attempt to match the best performer.

4.3. Changes to production processes do not necessarily have to be substantial in order to reduce waste significantly, as demonstrated by Niko, a multinational company which manufactures electrical light switches and home automation systems. In many factories, during the production of plastic units molten plastic is injected from a heated nozzle into a mould, leaving a "runner" of excess plastic in the cavity between the two. At the Niko factory in Belgium, we observed the "hot runner" system they had employed, consisting of a heated manifold which precisely distributed the molten plastic into the mould, leaving no excess runner. Although the excess pieces of plastic wasted from each mould would be only small, hundreds of thousands of these collectively could constitute a large material and financial cost. The adoption of the "hot runner" scheme therefore saved Niko a substantial amount of money, energy and material.[20]

4.4. We also visited Martin-Baker in Uxbridge, a company producing ejection seats, which had adopted a zero waste ethos. The company had systematically assessed all its processes in order to see where improvements could be made and, as part of this, had reviewed their systems for collecting and cleaning coolant liquid used within the factory machines. Previously, the coolant had sat in containers on the factory floor and was only cleaned every six to eight weeks, with old, contaminated coolant collected in tankers and taken for disposal. After researching systems used in Sweden, the company had implemented a new system which pumped the coolant off the factory floor and cleaned it on a continuous basis. Because the coolant was cleaned continually, it could be used for years with only minimal disposal off-site.[21]

4.5. Within the vehicle industry, waste reduction strategies are often linked to the light-weighting of vehicles. Mr Jerry Hardcastle, Vice-President of Vehicle Design and Development at Nissan, commented that they use a particularly high strength steel which, although difficult to manufacture, allowed Nissan to "delete additional brackets and … use thinner material," so there was less material to be recycled at the end of the vehicle's life. Mr Peter Stokes, Vehicle Compliance Manager at Volkswagen, told us that the way vehicles were shredded at the end of their lives had a direct influence on how they built them at the beginning of their lives. In the past, one manufacturer had produced bumpers which contained a "mix of materials that was very difficult to separate, very difficult to recycle and would more than likely end up in landfill," but manufacturers were now moving away from this towards the use of similar materials so that "you end up with something which can fragmentise easily and is subsequently easier to recycle" (Q 676).

4.6. Simple solutions to reduce waste can also be employed within the construction sector. Laing O'Rourke suggested that "lean, efficient off-site manufacturing and pre-assembly methods" could reduce the amount of waste often produced on-site by over-ordering, damage during transportation, lack of co-ordination with suppliers or damage by the weather. They added that substantial savings could be achieved "by adopting principles of standardisation in design or by engaging with the supply chain to ensure that standard manufactured components can be adjusted to suit a specific design." For example, from over-ordering or from cutting, plasterboard often attracted a significant amount of waste, so in one of its developments Laing O'Rourke had decided to use plasterboards of a standard height which matched the floor to ceiling measurements (pp 386-388). Mr Sexton, Head of Engineering at Laing O'Rourke, emphasised the fact that these types of decisions had to be taken early during the design stage, as "the die is to a certain extent cast" by the time you reach the site (Q 795). Ms Hobbs from the BRE agreed that it would often be uneconomical to try to make these savings later. She told us that "it is quite often cheaper to buy bulk materials in and waste them than it is to get the pre-cut plasterboard delivered," and "the cost penalties associated with delaying the project because you have run out of a bit of plasterboard far outweigh the costs of disposing of that waste plasterboard" (QQ 754-756).

4.7. However, implementing such changes to design, production processes or construction projects require an acknowledgement by businesses that they need to alter their practices. According to most of our witnesses, recognising this need for change was actually a significant stumbling block, made all the harder by a lack of rigorous methodologies which businesses could use to assess their waste.

Accounting for sustainability

4.8. A number of measures of resource efficiency have been developed in different industries. At the simplest end of the scale are measures such as "the number of kilograms of material used to make every kilogram of product," or the so-called "e-factor" which measures the mass of waste per unit of the product. In the chemical processing industry, a similar concept of "atom efficiency" can be used which describes the conversion efficiency of a chemical process. The CIKTN and the Chemical Industries Association (CIA) claimed that these types of concepts had "been very influential" (p 135).

4.9. On the other hand, Professor Grimes pointed out that such resource efficiency measures did not take into consideration the ease with which each type of waste could be dealt with, nor the resulting costs, and suggested that it would be better for industry to embrace "environmental accounting procedures" (Q 606). Mr Wilkinson from IChemE agreed, arguing that more thorough accounting systems should take into consideration the "energy efficiency" of the process and the "environmental impacts of the waste" produced. He added that a number of big companies had developed their own environmental accountancy systems and noted that IChemE had developed a set of sustainability metrics which tried to assess the environmental, economic and social impacts of production. He admitted that industry was "still some way away" from having a proper accountancy system that could be used to compare companies' sustainability performances and that "we are still looking at production in the age old way of rewarding shareholders rather than looking at how it might be impacting on the environment as a whole and on society as a whole" (QQ 608-609).

4.10. The British Standards Institution (BSI), in conjunction with the International Organisation for Standardization (ISO), has made some progress in addressing these problems with a series of environmental management standards known as the 14000 series, of which the most well known, ISO 14001, has been in existence for over ten years. BSI told us that "ISO 14001 is an internationally agreed approach to managing all aspects of a business that relate to its impact on the environment, and the implementation of this has enabled companies and organisations to reduce this impact, whilst, as a direct result, reducing costs" (p 70). Mr Marcus Long, Head of External Affairs at BSI, told us that by the end of 2006 there were about 130,000 organisations worldwide which were "certified to ISO 14001," including 6,000 in the UK. BSI has also developed the BS 8555 standard aimed at small businesses, which works in six stages to help them develop an environmental management system. Not only can these standards help businesses cut their costs whilst reducing waste, but certification can also be used as a useful marketing tool (QQ 173, 175). However, assessments of production processes are still hampered by a lack of knowledge about the sustainability of individual materials and products.

LIFE-CYCLE ASSESSMENTS

4.11. The TSB felt that the UK had "good academic capability in the area of life-cycle assessment" and that large multinational companies often demonstrated expertise in this area (p 229). For example, Unilever utilises sophisticated computer programmes to assess their packaging at the design phase without even having to make it. Dr Forbes McDougall, Environmental Manager at Proctor & Gamble, also told us that "we have very detailed information on our major product streams, and we can understand and identify" where the biggest environmental impacts are (Q 477). By contrast, the TSB reported that "mid-sized and small companies" generally did not have sufficient capability in LCA, which was perceived as "being expensive and time-consuming" (p 229).

4.12. The ISO has set out internationally agreed methods for calculating LCAs of materials and products, including the ISO 14040 and ISO 14044 standards (p 71). The LCA is not very widely used because, as Mr Wilkinson put it, "it is very complex and it requires a massive amount of data and a massive amount of research" when most of the time companies want to develop the product and get it onto the market as soon as possible (Q 609). The CIKTN and CIA agreed, reporting that "the key problem is that the ISO approved methods for life-cycle analysis are too slow, too complex and too costly for practical use in industry. As a result, a large number of 'cutdown' methods have been developed but not standardised" (p 136).

4.13. The complexities of LCAs also make it difficult for companies to derive clear results, as Mr Malcolm Fergusson, Senior Fellow at the Institute for European Environmental Policy, recognised. He suggested that technocratic details "can make an enormous difference to the outcome of the analysis. It can completely reverse the conclusions you get in the comparison of two products in some cases" (Q 111). Difficulties also arise due to the range of environmental criteria involved in such assessments and the emphasis placed upon each one. For example, the use of light-weight materials in a car might save on the amount of material used during production and result in less fuel being consumed during its use, but the light-weight materials may be more difficult to recycle at the end of the vehicle's life. The situation was summed up by EEF, the manufacturers' organisation, which reported that "methodologies with regards to the use and interpretation of LCAs still vary greatly and different approaches can lead to different results. Moreover, LCAs will always be based on assumptions rather than irrefutable data, are costly to undertake and might lock industry into long-term options, with little, if any, benefits to the environment" (p 115). As Mr Gareth Stace, Head of Environmental Affairs at EEF explained, "one life-cycle analysis will show up one result and another one might show up another result." This made it extremely difficult for manufacturers to know what to do (Q 247).

4.14. Within the construction industry, the BRE has developed an Environmental Assessment Method for buildings known as BREEAM, which considers factors such as the operational energy of the building, water and material usage. A similar assessment, the Civil Engineering Environmental Quality Assessment and Award scheme (CEEQUAL), has also been developed for civil engineering projects and Mr Andrew Swain, UK Environmental Adviser for Aggregate Industries, felt that both these assessments were "a positive, proactive way for clients, designers and contractors to demonstrate best practice" (Q 760). Nevertheless, Balfour Beatty and Ciria commented that "the weightings of different environmental aspects can significantly affect the output of a life-cycle assessment" and they argued that this complex issue warranted further research (p 399). Ms Hobbs added that "once everything is weighted and put into a single number, it is quite difficult to extract the waste information, to make decisions based upon waste reduction, and also make sure you are making the wider decision based upon environmental impacts" (Q 766). So in a similar way to the ISO standards, it was difficult to obtain conclusive results using these methods.

4.15. Carrying out LCAs in any industry is made all the more difficult by a general lack of information about the properties of materials used within products. The EIC noted that "the absence of consistent and robust standards for evaluating and reporting environmental impact means that each supplier is providing its own plethora of greenwash. This leads to confusion in the market place and many specifiers profess to be overwhelmed by the complexity of sustainability in practice. This in turn encourages a 'do nothing' approach, or an over-emphasis on single issues that are relatively simple to quantify," such as recycled content (p 112). Ms Hobbs agreed that there was a lack of information on individual products, adding that "suppliers quite often do not have that information, even if their customers ask for it" (Q 766). Even if a business did recognise that reducing waste was a worthwhile strategy, a real understanding of the materials and technologies needed to do it were often out of its grasp. This difficulty was recognised by the IoM which told us that information on materials was usually restricted to the "engineering performance or specification of the product and the associated costs," and common standards defining sustainability were "not readily available." Although some single factor ratings had been used to compare materials and products, IoM argued that "more comprehensive methods for full comparison, taking material, energy and environmental impact into account need to be agreed as international standards" (p 316). The CIKTN and CIA agreed, arguing "we urgently need internationally agreed methods for simple life-cycle analysis suitable for use in the early stages of design and product development when multiple concepts are being evaluated. Similarly, we need more data in the public domain on the environmental impact of different materials" (p 136).

4.16. The TSB thought that there was fairly good data for virgin materials, but acknowledged that for recycled material, "the lack of verified data and the need to develop standards for a range of materials form a major barrier to their wider use." It therefore suggested that a database of materials' properties could be a useful introduction but acknowledged the problem that "data exist at a number of levels and that needed to make life-cycle relevant decisions is not validated" (pp 229, 251). Mr Black, representing the REKTN concurred, saying that it would be "very difficult to provide relevant information in a single database," because the properties and requirements of materials would depend on where they were used in the supply chain (Q 436). Furthermore, although a range of materials databases already exist, Dr O'Connor from the Ecodesign Centre Wales pointed out that small businesses did "not find those appropriate for their needs," and he felt that it was more important to attempt to "tailor these databases and these tools and techniques to the needs of individual companies" (Q 363).

4.17. In an attempt to improve the situation, the BSI reported that where the properties of a material are not yet available, "well established standardisation processes" can be employed to produce "a relevant specification that is of use to the designer," and BSI can arrange the information in a number of innovative formats to present it "usefully to interested parties" (p 71). The BSI is also working with Defra and the Carbon Trust to develop a Publicly Available Specification (PAS) to measure the embodied greenhouse gases in products and services. Whereas a British Standard has to reach full consensus between all stakeholders on its technical content and can take time to be finalised, a PAS invites comments from stakeholders without committing to include them, and is usually developed more quickly. Using the PAS 2050 to measure the embodied greenhouse gases would, according to Mr Long, "hopefully help people understand the design element when they are looking at developing new products and services" and help them to reduce their waste (Q 153). The Government agreed, adding that "such a standard has the strong potential to help drive sustainability in materials and product design, as it should enable designers to better discriminate between materials with similar functional properties but different impacts on carbon emissions" (p 9). Thus ALUPRO felt the standard should become "a European if not a worldwide standard" (Q 274).

Recommendations

4.18. The ISO 14001 standard acts as a useful benchmark to recognise businesses which implement sustainable practices and we support the promotion of this standard to industry. We are concerned that once this standard has been achieved, businesses which do not recognise the costs of their waste may become complacent if they no longer have any incentives to drive further improvement. We recommend that the Department for Business, Enterprise and Regulatory Reform should ensure this standard is promoted alongside business education to enable industry to recognise the benefits that can result from continual innovation and waste reduction efforts.

4.19. Detailed information on the lifetime impacts of products is still lacking. The development of PAS 2050 is a step in the right direction and we commend the Government and industry for recognising the need for simple, yet standardised, assessment methodologies which businesses can apply. However, an assessment of embodied greenhouse gases is not synonymous with a life-cycle assessment. The Government, in conjunction with the industrial, design and materials communities, should encourage the development of simple methodologies to enable businesses to analyse the lifetime implications, including the amount of waste generated, of the materials, products or services they produce. Providing businesses of varying size and character with these key tools is vital as it will enable them to recognise the amount of waste they create and will be the first step towards implementing change.

Barriers to waste reduction: the impact of downstream factors

4.20. Despite the fact that our inquiry concentrated on the top end of the waste hierarchy, waste reduction, it became apparent that aspects of waste management and disposal have a great influence on the ability of industry to reduce waste upstream. In some cases these consequences were hard to define as they impacted upon the mindsets or attitudes of businesses towards waste. In other cases, bad practices downstream could cause more substantial, practical problems, such as a lack of recycled material to use in production processes. In the following chapters we examine the impacts that consumer and government attitudes have upon waste reduction, but in the remainder of this chapter we focus on some of the major barriers and incentives created by end-of-life disposal or waste management policies and regulations.

LOCAL AUTHORITIES

4.21. One of the major difficulties cited by businesses trying to reduce waste was that local authorities have developed independent strategies for waste collection and disposal, thus making it virtually impossible for national businesses to assess end-of-life consequences when developing their production processes or selecting materials. According to the BSI, a major barrier to the successful implementation of a waste reduction strategy for organisations with multiple sites is that "different local authorities have different ways of dealing with this issue" (p 70). This was backed up by Boots which said that the fragmented structure "prevents national brands and retailers from providing consistent advice to consumers and prevents co-ordinated product design and material selection choices being made." The company suggested there was also a lack of planning for any new materials coming onto the market, reporting that although "there has recently been significant growth in the use of compostable and bio-based materials … facilities for dealing with these materials and labelling for consumer information are lagging well behind" (p 451).

4.22. Mr Martin Wheatley, Programme Director at the Local Government Association (LGA) commented that there had been instances where companies had introduced new types of packaging with the best of intentions, thinking that they were recyclable, without realising that the materials were "extremely difficult for authorities to collect and recycle," so the products actually ended up in landfill when they were intended to be recyclable (Q 657). Hence the general consensus was that there was an urgent need to encourage greater collaboration between local authorities, waste management companies and producers so that manufacturers factored the costs of waste into their production calculations and understood the end-of-life implications of their products. Mr Wheatley said that the LGA had been doing just this, "promoting a discussion with trade bodies on the manufacturer and retailer side so that there is more of a dialogue between people who are thinking about new products and people who are responsible for their disposal" (Q 657).

4.23. Another problem was a shortage of recycled materials available to businesses. According to the CIKTN and CIA, "we have yet to devise processes that can reliably produce raw materials of the required quality from the general waste streams" (p 135). This problem was also identified by British Glass, which felt that the glass industry had the capacity to use more recycled glass in an attempt to reduce waste, but that the recycled glass (cullet) was not "fit for purpose" (p 138). Mr David Workman, Director General of the British Glass Manufacturers' Confederation, commented that although recycling rates were improving year upon year, the amount of glass coming back to industry for re-use was on the decline because of poor practices at recycling facilities. He told us that "some local authorities are collecting segregated colours and segregating glass but then the companies who operate the collection systems are then mixing them." The materials which left materials recycling facilities were of "terrible" quality and Mr Workman claimed that "if you talk to any material stream they would say they experience exactly the same problem" (Q 269).

4.24. Upon talking to other industries we found that this was, unfortunately, the case. Mr Rick Hindley, Chief Executive Officer at ALUPRO, added that in the aluminium sector the quality of the material collected through post-consumer schemes was "a real concern" and a large proportion of the material sent to material recycling facilities had to be sorted again before it could be processed through the recycling plant (Q 270). Within the electrical sector the situation appeared to be little better. Professor Ab Stevels, Environmental Adviser to Philips, complained that Philips could not access "a continuous stream of constant quality and high volume" plastic and that "the structure of industry" was hampering progress (Q 300). Backing this up, Mr Peter Evans, Senior Environment Manager at Sony UK, told us that "the materials available from the recycling stream are not in high enough quantities to make it viable for us to use" (Q 302).

4.25. These difficulties appeared to be related to the targets and costs imposed upon local authorities. Dr Robert Chilton, Board Member at the National Consumer Council, told us that recycling plants could separate various types of plastic but that because local authority targets were set in terms of tonnages, "they have been going for mixed waste" (Q 479). This was supported by Mr Workman, who explained that when he tried to discuss this with local authorities, they understood the problem but were reluctant to change their practices because they had targets to meet and "their primary objective is to avoid landfill at all costs" (Q 271). This then affected the ways in which contracts were set up between local authorities and waste management companies, with Mr Hindley commenting that there was "no incentive for the waste management company to produce a clean quality product" because their profits were based on the weight of material handled (Q 270).

4.26. A concentration on weight promotes the diversion of heavy material away from landfill, to the detriment of recycling light, valuable materials such as aluminium. Aluminium is infinitely recyclable and the recycling process only uses around five per cent of the energy required to produce new aluminium. Despite this, 35 million tonnes of new aluminium is still being produced annually, compared to only 16.4 million tonnes of recycled aluminium. There was hope that the situation was improving, with ALFED and ALUPRO predicting that the amount of aluminium recycled from end-of-life scrap would double by 2020, but even so despite best efforts over 90,000 tonnes of aluminium packaging is still being sent to landfill in the UK. ALFED and ALUPRO welcomed the Government's Waste Strategy which identified aluminium as one of its "key materials" and pledged to develop proposals for higher packaging recycling targets. Nevertheless, the industry felt that aluminium packaging was not a priority for local authorities because their targets were "weight-based with strong incentives to divert biodegradable waste" (pp 127-128, 131).

4.27. Furthermore, the costs of landfill and the targets set for local authorities means they are reluctant to provide additional waste services to industry, so small businesses in particular find it difficult to dispose of their waste. Mr Holbrow from the FSB told us that small businesses did not produce enough waste to interest recycling companies, but that they were not allowed to use civic amenity sites for recycling. The policies of local authorities were therefore "not conducive" to encouraging recycling and re-use amongst small businesses. The stark choice was that waste "either goes to commercial contractors if the volume is of sufficient interest, or it ends up in landfill" (QQ 158, 162). Within the retail design industry, Miss Dutton from the RED Initiative claimed that businesses had a high turnover of materials and were keen to use recycled products but that they were "having issues with returning that material to recycling points" and found it difficult to get hold of recycled material in the right quantities (Q 420).

4.28. Mr Wheatley defended the position of local authorities, arguing that many local authorities went further than they were statutorily required to do, providing the type of recycling service to SMEs which the private sector would not offer. He explained that local authorities face "a disincentive to collect waste from businesses because any residual waste that they end up with is subject to the Landfill Allowance Trading Scheme (LATS), unlike private contractors" (Q 669). The LATS scheme allocates tradable landfill allowances to each waste disposal authority, which allows them to landfill a certain amount of biodegradable municipal waste in a specified year.[22] Mr Peter Jones, Director of Biffa, told us that in England, only local authorities are subject to the LATS system, whereas in mainland Europe, all businesses are subject to LATS-type regulations. In his opinion, this explained the "enormous divide between waste from households and waste from industry and commerce" (Q 672). Despite encouragement in the Government's Waste Strategy for local authorities to engage with business waste, Dr Andrew Craig, Principal Policy Officer at the Local Authority Recycling Advisory Committee (LARAC), pointed out that operation of the LATS militated "very strongly against that" because if local authorities collected more commercial waste then it increased their risk of not having enough landfill allowances (Q 669).

4.29. There had also been uncertainty surrounding the definition of municipal waste and Defra launched a consultation in 2007 to examine this.[23] In its response the Government said that they would introduce legislation to amend the legal definition of municipal waste, to align it with guidance given to local authorities. This would amend the definition so that municipal waste "encompasses all waste which comes into the possession or under the control of waste disposal or waste collection authorities, with the exception of construction and demolition waste."[24]

4.30. Ms Hill from Green Alliance sympathised with local authorities, who she said were driven by a complex mix of landfill regulations and recycling targets as well as money, demographics, the type of population they represented and the kind of areas they covered. She added that "we began to feel very sorry for the average local authority trying to deal with these problems, as set against our vision of a resource reclamation society, because nobody seems to have that responsibility for creating a resource reclamation society other than these poor local authorities who do not have the tools to develop it." She commended the LGA for trying to provide advice on best practice but noted that the difficulty was a "lack of a national coherent strategy" with the current trend for giving powers to local authorities resulting in "fragmentation and inaction in some cases" (QQ 561-562).

4.31. It is clear that local authorities are struggling with the regulations. Dr Craig told us that local authorities would like to remove more lightweight materials from the waste stream but that they were "very expensive to collect in terms of pounds per tonne" and local authorities currently bore the cost. He added that "there should be more consistency between the systems that are operated to collect waste, both from individual people and from firms, but the cost is a crucial issue as far as local authorities go." He suggested that the answer might be to increase the use of producer responsibility, shifting some of the cost and responsibility onto producers (Q 664). This idea was supported by Mr Jones who said that if a more decisive approach to producer responsibility was taken, around 10-12 million tonnes of the 30 million tonnes for which local authorities were responsible "would change from being a cost liability on the local community [into] an income from those industry supply chains" (Q 665).

4.32. In their Waste Strategy, the Government suggest that under a new local government framework there would be a strengthened role for Local Area Agreements between local authorities, local partners such as third sector organisations, and central government. They claim that these would help central government "focus on the things that really matter to people everywhere, guaranteeing national minimum standards, but leaving room for local innovation and local priorities." Legislative barriers have also been removed allowing the creation of joint waste authorities—new legal entities which take responsibility for waste collection and management. The strategy claims that the Government are "encouraging local authorities to use their role as local community leaders in partnership with businesses, other local, sub-regional and regional public sector organisations and third sector organisations to achieve a more integrated approach to resources and waste in their area."[25]

4.33. While Mr Wheatley felt that it was important for local authorities to remain in control of waste management at a local level, he said that there was "a lot of scope for local authorities to work together on some of the more downstream aspects to secure economies of scale and make sure that their practices follow the best available evidence" (Q 661). It seemed that local authorities were still struggling to achieve this integrated approach in the current climate. Although the Government's Waste Strategy acknowledges complaints from local authorities that the LATS constrains their ability to deliver disposal and collection facilities, it merely suggests that they should facilitate commercial waste management contractors or social enterprises offering recycling collection services for business waste.[26] Dr Craig commented that the Government's "light touch review" of the LATS had not addressed their concerns about commercial waste (Q 669).

Recommendations

4.34. Responsibility for the recycling and collection of waste has been given to local authorities, not all of whom meet the needs of businesses. Poor quality recycled material, a lack of disposal facilities and a fragmented approach between local authorities hinders the attempts of those businesses which are striving to reduce their waste. In turn, local authorities are hampered by weight-based targets and landfill allocations which discourage them from supporting industry. Targets for local authorities currently focus on decreasing the weight of domestic waste sent to landfill but a more holistic approach to waste reduction is required. We recommend that the Government should restructure the waste targets and costs imposed upon local authorities to allow them to address commercial and industrial waste by providing the necessary support, disposal facilities and high quality materials to businesses.

4.35. It is extremely important that local authorities co-ordinate the services they provide. Whilst joint waste authorities will largely be concerned with the collection, treatment and disposal of waste, we hope that their creation will lead to greater collaboration between local authorities on all aspects of the waste hierarchy, so that they can provide the consistent facilities and support which businesses require in order to invest in long-term waste reduction strategies and experience the economies of scale.

THE DEFINITION OF WASTE

4.36. The CIKTN and CIA said that the definition of waste was "posing a barrier to sustainable waste and resource management." They suggested that it deterred producers from sustainable ways of managing their by-products, such as burning them in a combined heat and power plant, "towards sending such by-products, often over long distances, to the limited commercial incinerators available or to landfill" (p 137). This frustration was echoed by those in the construction industry. Balfour Beatty and Ciria reported that "the legal definition of waste is perceived in the industry as hindering re-use. This is particularly so when the producer knows the material has value, but cannot find a practical use at that point in time, and so must 'discard' it." They added that the complexities of handling waste materials "will often steer contractors towards a solution that utilises virgin materials rather than complete the necessary paperwork and wait for the Environment Agency to respond" (p 399). Ms Liz Parkes, Head of Waste at the Environment Agency, believed that the definition of waste itself was now well established and did not need alteration. However, she reported that there had been debate on the definition of "end-of-waste" when waste ceases to have the "waste" label applied to it; a topic on which the directive had, until recently, been "silent" (QQ 100-101).

Waste Protocols project

4.37. The Waste Protocols project, run by the Environment Agency and WRAP, has been examining a number of materials to assess whether the difficulties of complying with waste legislation can be removed to increase their use as a resource. In each case, technical assessments, industry consultations and financial impact assessments are taken into consideration and either a quality protocol or a regulatory position statement is produced. A quality protocol "sets outs the steps that must be taken for the waste to become a product or material that can be re-used by business without the need for waste management controls and can be safely marketed and sold as a product in its own right." A regulatory position statement "informs the business community of what regulatory obligations they must fulfil to use the processed waste material." So far, draft quality protocols have been published for segregated biodegradable wastes (compost), waste cooking oil derived biodiesel and flat glass; a regulatory position statement has been published for wood; and blast furnace slag has been deregulated and is now treated as a by-product. Consultations for segregated biodegradable wastes (anaerobic digestion), tyre-derived rubber material and non-packaging plastics have been completed, with other consultations in the pipeline for pulverised fuel ash, paper sludge ash, steel slag, incinerator bottom ash, waste plasterboard, uncontaminated topsoil and contaminated soils (pp 68-69).

4.38. According to Ms Parkes, the quality protocols were "forcing material back into productive use at a faster rate than would have happened" if it had not been classified as waste in the first place. The programme appeared to be popular with industry, with Mr Christopher Murphy, Deputy Chief Executive at the Chartered Institution of Wastes Management (CIWM), adding that the Environment Agency and WRAP had "done some extremely good work" (Q 642). EEF reported that the quality protocols had begun to address the problem but suggested that "a more consistent approach across the EU will help more low risk materials to be used as a resource" and suggested that the Government "should continue to lobby EU institutions on this during the ongoing revisions of the EU Waste Framework Directive" (p 116).

Revision of the Waste Framework Directive

4.39. In 2005 the European Commission published its Thematic Strategy on the prevention and recycling of waste, which said that "in the light of extensive stakeholder consultation the Commission has concluded that there is no need substantively to amend the definition of waste, but that it is necessary to clarify when a waste ceases to be a waste (and becomes a new or secondary raw material)."[27] Its accompanying document, EU Waste Policy—the story behind the strategy, commented that "the feedback from this consultation revealed that there is a significant consensus in favour of not radically changing the definition of waste. One reason was that there is no obvious better alternative; another that change would render uncertain the twenty years of case law from the European Court of Justice on application of the definition that has helped to make the situation clearer."[28]

4.40. Following this, Defra launched a public consultation on the Commission's proposal to revise the Waste Framework Directive, asking stakeholders for their views on the definition of waste. In the Government's view, the responses they received did "not demonstrate clear-cut stakeholder support for a change in the definition of waste." Instead, stakeholders raised issues "relating to the inclusion in the revised Waste Framework Directive of provisions on by-products as non-waste and waste ceasing to be waste" (pp 424-425).

4.41. In June 2008, the European Parliament and Council of Ministers reached an agreement on the revised Framework Directive on Waste. This includes two provisions providing clarity on these topics, which have received support from the Government. The Government told us that the UK has "consistently supported the inclusion of an end-of-waste provision in the Waste Framework Directive throughout the negotiations on the Directive's revision" (pp 425-426). Article 6 of the revised directive allows the Commission to specify environmental and quality criteria for waste materials which, if met, would mean that the materials will cease to be classified as waste.[29]

4.42. The Government reported that most Member States also took the view that the revised directive should clarify the status of by-products as non-waste, "and took steps to ensure the inclusion of such a provision in the revised Waste Framework Directive" (p 426). The CIKTN and CIA supported the introduction of a "by-product" definition which would "help clarify the distinction between waste and product and therefore maximise efficient use of resources" (p 137). Professor Grimes concurred, suggesting that "waste should only be material destined for final disposal" and that "anything that can be re-used or recycled should be defined as a non-waste by-product" (Q 633). Article 5 of the agreed revision now provides that substances or objects resulting from a production process, the primary aim of which is not the production of that item, may be regarded as not being waste, but as a by-product, if certain conditions are met.[30]

4.43. The Government clarified that the end-of-waste criteria that will be developed under the revised directive will have broadly the same objectives as the Environment Agency's quality protocols, with two significant differences. Firstly, the Environment Agency's quality protocols are national in scope and, "whilst they reflect case law established by the European Court of Justice on the definition of waste, they are non-statutory." Secondly, the criteria adopted by the Commission "would apply throughout the EU and would be legally binding," so if the Commission adopts criteria on a waste stream for which the Environment Agency has already developed a protocol, then the protocol will be superseded. By carrying out some of this work ahead of the Commission, the Government thought that the Environment Agency will ensure "the UK is well placed to make an effective contribution to the Commission's development of EU-wide end-of-waste criteria." Apparently the UK was already doing this, "in the context of the preparatory work being undertaken by the Commission's Joint Research Centre in Seville" (p 426).

Recommendations

4.44. Until recently, the legal framework has militated against the re-use of particular waste streams and we are glad that the need for clarification has been recognised. We welcome the revision of the Waste Framework Directive and support the inclusion of articles which specify conditions for by-products and allow the development of quality criteria to clarify when waste ceases to be waste. We hope that these will result in greater exploitation of a wide range of resources.

4.45. With the development of quality protocols by the Environment Agency and the Waste and Resources Action Programme, the UK is in a good position to contribute effectively to the development of end-of-waste criteria at the EU level and we urge the Government to continue to work closely with the Commission and other Member States to develop quality criteria as quickly as possible. We recommend that the Government should urgently provide clear information to UK businesses about the priority sectors and waste streams that will be considered first and the timeframe in which quality criteria will be developed for each material.

EXTENDED PRODUCER RESPONSIBILITY REGULATIONS

4.46. The extent to which EPR regulations have driven real change in design and production processes is debatable. According to the waste management company Biffa, the implementation of producer responsibility regulations in the UK has been "disjointed" and as a result there is still no connection between end-of-life waste and the design and production process. In their view the failure of the Government to implement producer responsibility regulations fully has "resulted in a 'lost' two decades in which end-of-life management processes could have been integrated into the design and manufacturing process" (pp 341-342). Green Alliance added that producer responsibility schemes had not been wholly successful because responsibility had been fragmented and diluted "through the involvement of third party organisations" (p 281). Envirowise was also disappointed that the implementation of regulations had not "always achieved the optimal outcome" but suggested that producer responsibility legislation had at least "started to change attitudes in certain areas" (p 88).

ELVs

4.47. The ELVs Regulations appear to have had limited success at fostering an attitude of waste reduction within the automotive industry. The Society of Motor Manufacturers and Traders (SMMT) reported that the requirement to eliminate certain heavy metals meant the component supply industry has to work closely with vehicle manufacturers to inform them about the materials and quantities used. This has led to the development of the International Material Data System, a centralised database to share information, a facility which so many other sectors appear to lack. It has also prompted the creation of an ISO standard, ISO 22628, which manufacturers can use to calculate the recyclability and recoverability of their vehicles. SMMT thus felt that the practices put in place since implementation of the directive demonstrated "that good design, avoidance of waste and recovery at end-of-life are important considerations in the development phase" (p 356).

4.48. This was despite the fact that the Driver and Vehicle Licensing Agency had failed to implement a foolproof Certificate of Destruction system, "an essential component" of ELVs legislation, which meant that not all cars were being returned for recycling and re-use. SMMT felt that laws must be correctly enforced, otherwise "those who comply often have to invest heavily whilst those who do not comply escape both investment and too often enforcement" (p 358). Despite this hiccough, Mr Steve Franklin, Senior Manager of the Environment Group at SMMT, felt that by and large the UK had seen "one of the more successful implementations of the ELVs legislation" (Q 731). However, the targets set by the directive had been set in terms of recycling and recovery and, as noted earlier, some witnesses felt that manufacturers had met the criteria by improving recycling techniques rather than truly redesigning their processes.

4.49. The automotive industry appears to be well aware of the importance of making their processes as efficient as possible. It could be argued that this is largely because the sector is dominated by big multinational companies who recognise their production costs and so minimise waste from a business perspective. For example, Toyota has been promoting the sustainability of its manufacturing plants for years and all of its European plants have obtained the ISO 14001 standard. They have also reached their waste reduction targets three years ahead of schedule and are planning to re-set them to achieve even greater efficiency. They felt that the ELVs targets had partly acted as an incentive, but they were already taking steps in this direction anyway.[31]

4.50. Thus, whilst the ELVs regulations have encouraged greater recycling, it is questionable as to whether they have acted as strong drivers to minimise waste.

Packaging

4.51. Packaging is a contentious issue which has attracted a great deal of consumer and media attention. Some of this attention is deserved as excess packaging was at one time a significant problem, within the food industry in particular. However, several of our witnesses argued that good progress had been made in recent years towards reducing this problem. When the Producer Responsibility Obligations (Packaging Waste) Regulations were first introduced, Mr Stephen Carter, Packaging Sustainability Director at Unilever, noted that "the whole packaging chain, from raw material manufacturers to retailers, really felt the pressure of gathering the data and putting the systems in place to gather the data. But that is all done now. Each corporation and retailer has data management systems that are efficient and they work" (Q 508). Ms Bickerstaffe, representing INCPEN, agreed that the system had been a success and the recycling targets set out by the European Commission were very likely to be met (Q 507). On the other hand, the SDC commented that the directive had "not put high enough costs on producers to force them to rethink product design" and the costs were "minimal compared to other business costs" (p 289).

4.52. There was more uncertainty about the success of the Packaging (Essential Requirements) Regulations. Envirowise thought that they "do help to reduce unnecessary packaging" but that "they do not appear to be well known or regularly enforced" (p 88). This was backed up by the evidence provided by Essex County Council, which pointed out that "the low number of successful actions taken against those responsible for putting over-packaged products on the market highlights the inherent difficulty in applying these regulations" (p 460). Similarly, the SDC thought that the regulations were poorly enforced and local trading standards departments were "insufficiently resourced to monitor for over-packaging." They added that stronger and more effective implementation of the regulations was needed (p 289).

4.53. So again, as with the ELV regulations, the extent to which these regulations have really altered the mindset of businesses is dubious and further encouragement is needed.

WEEE

4.54. The WEEE Regulations were the cause of much criticism throughout our inquiry. Within the WEEE Directive a system of individual producer responsibility (IPR) was outlined which would make each individual manufacturer responsible for the take-back, re-use and disposal of their own products. Many Member States, including the UK, have failed to transpose this system of IPR into national law. Mr Tony Pedrotti, Director of the Sustainable Development and Regulation Directorate at BERR, told us that even though some countries had put IPR onto their statute books, none of them had implemented it (Q 43).

4.55. Despite its attraction as a concept, the difficulty arises in applying IPR in practice. This is partly a result of the waste collection system, as Mr Black pointed out: "we generally have a very unsegregated waste recovery chain which makes it very difficult" for manufacturers to take back their own products (Q 438). In fact, Mr Pedrotti remarked that trying to implement IPR in our current climate, which would require the collection, sorting and re-distribution of waste to manufacturers' sites, might cause more damage than good to the environment (Q 42).

4.56. In practice, the collection, treatment and disposal of WEEE products is based upon a system of collective producer responsibility (CPR). Manufacturers register with a producer compliance scheme that disposes of their WEEE products appropriately and all brands are handled together. The proportion paid by each producer is dependent upon their market share. Dr Kirstie McIntyre, Head of Take-back Compliance at Hewlett-Packard, claimed that CPR made it even harder to re-use material. She explained that "what comes back is a selection of everybody's equipment," which comprises various different types of plastic and so "when you get this mixed selection, mixed bag of products back, it is very difficult … to pull out enough to feed into a manufacturing process to really make a difference." Although it appeared that local authorities had been collecting plenty of materials, the problem was that they were mixed and "the economics of unmixing them renders them economically impossible to do anything with later on" (QQ 303, 326).

4.57. Another complaint was that the WEEE Regulations were not sufficient to encourage innovation and promote waste reduction amongst businesses. Within the CPR system, there was no real incentive for a manufacturer to reduce his own waste as he could just make the payment for his market share and think nothing more about it. As Dr McIntyre succinctly explained, the problem was common to all producer responsibility directives because they "create a lowest common denominator, which is good, because it drags all of the laggards up to a good level, but it does not reward the innovators" (Q 295). In the view of the Electronic Producers Environmental Policy Forum (EPEPF), the introduction of IPR would provide producers "with a powerful economic incentive to design those products in a way that makes them easier and cheaper to recycle or re-use," but without this, "the incentive to encourage producers to focus on design for recycling is absent" (pp 457-458).

4.58. Larger companies who were keen to innovate, such as Hewlett-Packard, had established their own recycling schemes on a voluntary basis to generate the raw material for their production processes, but Dr McIntyre said that the law did not recognise these efforts. She acknowledged that an IPR system would not be suitable for every manufacturer, but felt that "for those manufacturers who do want to implement these systems we believe that the law should allow us to jump in there and get on and develop our systems, which currently UK law does not enable us to do" (QQ 303, 326). Mr Andrew Clack, Environmental Affairs and Corporate Social Responsibility Adviser at Panasonic UK, agreed that "ultimately producers would like to be responsible for their own waste and not for somebody else's" and added that Panasonic had also made some IPR arrangements for computers in the UK. He acknowledged that IPR needed to be implemented "by sector or product grouping rather than universal" and that "for some products it works but for others we cannot see a practical way of making it work" (Q 330).

4.59. Some witnesses cited Japan as an exemplar country at implementing IPR (Q 315, pp 151, 154, 313, 458). However, industry should be reticent in making general comparisons with Japan because the market and product streams are so different. Unlike the EU, Mr Clack noted that Japan was "one homogeneous market" and the country had only focused on four product categories which made implementing IPR "far simpler." Manufacturers in Japan also had a much stronger link to retailers, with around 80 per cent of end-of-life material being returned through retailers and only 20 per cent through municipalities; a situation which was "totally the reverse in Europe" (Q 329). Professor Stevels also questioned whether IPR in Japan had been a success, noting that it cost the consumer a significant amount of money to recycle products, "so even if you score a better environmental gain in that country the environmental gain over cost ratio in Japan is disappointingly low" (Q 335).

4.60. Although international examples could be useful, Dr McIntyre urged careful consideration of the best way to tackle this in Europe, noting that "there is no immediate solution that is a perfect fit for Europe" (Q 316). Furthermore, Professor Stevels commented that because regulations took a long time to be "introduced to the real world," legislation was often based on conclusions that were out of date (Q 297). The United Nations University has recommended that the WEEE Directive should be simplified into "a basic framework and to leave the developments of standards of working to the field itself" to allow for developments in technologies and operations.[32]

4.61. Mr Wicks, Minister for BERR, told us that the Government would like to implement IPR because it would provide an added incentive for companies to "think right from the first day of designing a product how to design, in a way that is sustainable," but he acknowledged that the practical difficulties were large and they needed to work with producers in order to find solutions (Q 854). In order to do this BERR had established the WEEE Advisory Board, a non-governmental public body, to assess the implementation of the WEEE regulations to date and assess the opportunities for implementing IPR.[33]

Recommendations

4.62. Collective producer responsibility directives have had limited success at encouraging sustainable design and often result in small technical innovations which increase recycling and comply with minimum standards, rather than fully embracing the principles of sustainability. However, we acknowledge that they do at least bring the subjects of sustainability and waste reduction to the attention of business and so their basic principles should be encouraged. We recognise that these directives must be developed on an international basis and recommend that the Government should work with the European Commission and EU Member States to review the ways in which these directives are applied so that they foster real innovation and encourage all businesses to continually reduce their waste.

4.63. We welcome a review of the implementation of the Directive on Waste Electrical and Electronic Equipment and support the establishment of the Waste Electrical and Electronic Equipment Advisory Board. Implementing individual producer responsibility will be a long and complex process, but will be crucial in establishing the direct responsibility necessary to encourage manufacturers to reduce their waste. We recognise that individual producer responsibility will be more appropriate for some products than others and it is important that the Government continue to consult stakeholders on the practicalities of such a system. Nevertheless, we believe that the time has come for action and recommend that the UK Government should take the lead in implementing true individual producer responsibility and, at the very least, should introduce it for those products for which industry requests it.

A HOLISTIC APPROACH TO REGULATION?

4.64. Complying with just one piece of legislation can be difficult enough, but usually businesses have to consider regulations alongside many other pieces of legislation. Not only can this be time-consuming and complicated, it can be virtually impossible if different regulations present conflicting requirements.

4.65. Within the electrical sector, Mr Evans commented that Sony had to comply with regulations on EuP, WEEE and the restriction of chemical substances, but "those three pieces of legislation are all piecemeal … you will get many cases when they are in contradiction to one another." As an example, in order to reduce the amount of hazardous materials in their products they eliminated mercury from the backlights of personal computers, but in doing this they "had to increase the power consumption of the product to make the backlights as bright as they were previously." The effect of one piece of legislation therefore had "unintended consequences" for other environmental aspects (Q 297).

4.66. SMMT commented that modern vehicles have to comply with many legislative requirements, including "crash protection, material recovery, and the need to reduce weight to achieve carbon dioxide targets" but "these requirements often conflict with each other" (p 356). Mr Franklin often wondered whether each new regulation was developed in conjunction with other pieces of legislation but very often came to the conclusion "that it probably was not" (Q 723). As Mr Hardcastle explained, crash protection regulations not only required the use of more material which meant there was then more to dispose of, but it also made vehicles heavier so "the greater the conflict with the carbon dioxide emissions" (Q 722). Difficulties were also reported by Ford, which claimed that the combination of ELVs recycling targets and safety and air quality regulations limited the industry's ability "to meet its principal environmental focus of reducing carbon dioxide emissions" (p 467).

4.67. As we have noted above, there was also concern that current regulations focused too much on the weight of waste going to landfill and did not consider the bigger picture of sustainability. As an example, although the Packaging Waste Regulations aim to reduce packaging by weight, Boots highlighted the fact that they "take no account of recycled material content, product wastage or the impact of different material types" (p 451). CIKTN and CIA also pointed out that weight-based targets can cause "perverse or unintended consequences" such as the light-weighting of packaging leading to the increased use of materials which are harder to recycle (p 137). Weight therefore is not necessarily the best way to define targets. The use of volume can also be problematic as waste can be compacted to varying degrees. CIKTN and CIA felt that decisions and policies should ideally be based on considerations of the whole life-cycle, although they acknowledged that "this remains difficult and costly to do in practice." Instead they suggested that targets should be set depending on the material and product, perhaps using a combination of measures such as weight, volume and toxicity (p 137).

A weight-based success?

4.68. The Government's landfill tax escalator will increase the standard rate of tax by £8 per tonne each year from 2008 until at least 2010-11 (p 3). Despite the criticism of other pieces of legislation it should be acknowledged that this tax, based on the weight of material, has been relatively successful at reducing waste according to many witnesses. Mr Merlin Hyman, Director of the EIC, described the landfill tax as a "fairly blunt driver but an effective one nonetheless" and he felt that the tax escalator had encouraged waste reduction (Q 220). Mr Jonathan Davies, Chair of the Waste Working Group at the EIC, agreed that the landfill tax had been "a tremendous success" (Q 226).

4.69. Some argued that the landfill tax was not costly enough. Ms Hill claimed that we "treat recycling as almost a waste disposal technique or alternative to waste disposal, not as an economic goal" and that more regulatory and fiscal measures were needed to encourage material recovery over landfill (Q 553). Mr Swain also suggested that "it still is cheaper, in certain areas, to dispose of to landfill inert construction demolition waste than it is to re-use or recycle it" (Q 772). A balance always has to be struck between discouraging waste without encouraging illegal disposal. Ms Ruddock, the Defra Minister, pointed out that although some areas of industry had asked her to "put it up even more, drive this forward even harder," other areas told her that they were already finding the costs difficult to bear (Q 846).

Recommendations