Waste or resource? Stimulating a bioeconomy - Science and Technology Committee Contents


Chapter 3: Key Issues

Government Strategy

58.  Waste policy and regulation cut across several Government departments and agencies and it is not immediately straightforward to determine where responsibilities lie. The Committee received evidence (in writing, orally, or both) from the Department for Business, Innovation and Skills (BIS), the Department for Environment, Food and Rural Affairs (Defra), the Department for Transport (DfT), the Department for Communities and Local Government (DCLG), the Department of Energy and Climate Change (DECC) and the Environment Agency (EA), as well as local government.[91] This evidence revealed a panoply of policies and initiatives connected to waste and the bioeconomy. We were told, for instance, about the potential of industrial biotechnology, policy on biofuels, energy from waste, anerobic digestion, the Industrial Strategy, the Chemicals Strategy, Bioenergy Strategy and the circular economy.[92] For example, in oral evidence, the Minister of State for Business and Enterprise, Department for Business, Innovation and Skills (BIS) and the Minister of State for Energy, Department of Energy and Climate Change (DECC), told us about:

"… the work we do with the chemicals industry through the chemical growth partnership that I co-chair with Neil Carson from Johnson Matthey. We are looking very specifically at the potential for waste resources to power green developments and a lot of effort is being put into targeting chemical and chemical-using businesses that do have the potential to adopt new processes to harness waste feedstocks for the future."[93]

59.  It is indisputable that there is a considerable amount of Government activity on waste, but our inquiry revealed far less emphasis on the transformation of carbon-containing wastes into higher value products. We have some sympathy with the Government; the science and technology is developing quickly and it is not the Government's role to back certain technologies. In this regard, we agree with Dr Church, Director, Resource, Atmosphere and Sustainability, Department for Environment, Food and Rural Affairs, that:

"… whenever Government tries to guess this technology, that technology, the other company, we make as many losers as we do winners. Historically, it is not something that Government is very good at doing. What we are trying to do is set a context, a market framework and a regulatory framework to the greatest extent we can. Then it is for the actors in the economy—be they early stage investors or late stage investors—to try things out. If there is something that is fundamentally flawed, there is a real market failure. If we are convinced of that, and it is a good place for the taxpayer money and taxpayer resources to go into, then we do act. That is why we have incentives to support low-carbon energy. Without those incentives we were not making the progress that collectively, as a country, we need to do. We do not have in front of us an incontrovertible case that a particular kind of bioenergy or bioeconomy support is necessary in order for this country to thrive."[94]

60.  As we set out in the previous chapter, however, the economic and environmental prize of developing a high value bioeconomy is substantial and may prove to be very considerable. Currently, policies and incentives tend to focus on lower value products, such as energy. Once one starts distorting the market by giving certain sectors incentives, there is an obligation to ensure that one is not disincentivising market entry by companies with the ability to produce higher value products.

61.  For example, we heard a great deal about Anaerobic Digestion (AD), a natural process which is used to transform bio-wastes into bio-gas and digestate. The May 2010 Coalition Agreement stated that: "We will introduce measures to promote a huge increase in energy from waste through anaerobic digestion."[95] The Anaerobic Digestion Strategy and Action Plan for England, published jointly by Defra and DECC in 2011, sets out government strategy.[96] The Government's focus on AD recognises:

"… the multiple benefits that the sector could deliver when processing food or farm wastes. As well as generating biogas for use as a fuel, it diverts food waste from landfill, provides greenhouse gas savings and income for the farming sector. The digestate from AD can be converted into a valuable by-product which would contribute to the wider bioeconomy."[97]

62.  AD has been well supported by the Government and there are now almost 130 AD facilities in England with more than 200 in planning.[98] Germany, however, commissioned 1310 AD plants in 2011 alone.[99] While it might be tempting to conclude that the UK is lagging behind, we heard that there is over-capacity in Germany and, moreover, many of their AD plants tend to be crop-based. Germany is growing maize specifically to feed AD facilities. What therefore seems environmentally sustainable might well lead to a food versus fuel conflict. Professor Shah explained to us that the situation in Germany was:

"… a result of the subsidy regime that is particularly present in Germany. It makes it profitable to use maize for AD to make gas, which is either then injected into the grid or turned into heat and power. It is more valuable than the maize as either animal feed, chemical feedstock or human feedstock. That is an example of perhaps where the system has gone wrong."[100]

Dr Warhurst from Friends of the Earth told us:

"Quite a lot of anaerobic digestion plants are being built around the country or are in place now. The worry is that lots of people are thinking that they are going to get something out of this waste, whereas in fact we will end up with the opposite thing where there is too little waste and then we will start using primary production of food in order to power these processes. I would say that is our biggest concern in this area."[101]

Peter Jones argued that other technologies offered greater efficiencies:

"… to create 8500 Megawatt Hours (MwH) electricity (worth around £900,000) an AD plant requires 45,000 tonnes, advanced thermal oxidation requires 16,000 tonnes whilst high temperature gas plasma requires only 7,000 tonnes from the same material."[102]

63.  Whilst noting the benefits of AD, we would urge some caution towards this technology, which the Government are perhaps too ready to champion. The UK should not seek to replicate the German model and we welcome Defra's position of not encouraging a policy such as that in Germany which has resulted in a reliance on crops grown specifically to feed AD installations.[103]

64.  We were concerned to be told that current Government incentives are sector focused, supporting particular technologies such as AD, incentivising energy production and mitigating against higher value uses of waste:

"The legislative and fiscal dynamics are currently pulling in different directions. Industries such as power production from anaerobic digestion are heavily subsidised to the point where chemical production, which would compete for the same feedstock in a non-subsidised market, only provides marginal returns and is therefore unlikely to see the investment due to the additional technical and commercial risk, even though in the long-term it provides the best economic solution for UK Plc."[104]

Similarly, the Royal Society of Chemistry told us:

"Much of the Waste Policy review focuses on waste management practices, rather than treating waste as a resource (valorisation). Existing policy dealing with waste recovery is largely focused on energy generation, rather than creation of higher-value products."[105]

The Centre for Process Innovation noted that:

"… the UK market is small relative to many EU nations. The market for anaerobic digestion—the main route for processing wet organic wastes—is still in its infancy and the market for gasification or pyrolysis based processing to syngas is also small. The bulk of UK bio-wastes are destroyed in incinerators. This legislation driven approach significantly reduces the amount of waste available for upgrading to higher value products."[106]

65.  Government policy on extracting value from waste lacks coherence and certainty. We agreed with Dan Rogerson MP, Parliamentary Under Secretary of State for water, forestry, rural affairs and resource management, when he told us that:

"We think the Government has a role in tackling barriers and in setting the conditions that allow the market, businesses, local authorities and individuals to make the changes and move us towards an economy in which waste is valued as a resource."[107]

66.  At the moment, however, it is not clear to us that the Government are sufficiently seized of the role that they articulate. It would be unfair to dismiss out of hand the various initiatives and strands of policy but there is a lack of a strategic lead. Stakeholders do not currently think that policy and regulation are sufficiently aligned and that cross-departmental co-ordination is optimal; there is a need for greater co-ordination and long-term policy stability. The following examples are indicative:

"… whilst there are elements which support growth, existing policy and regulation, the uncertain regulatory environment and the lack of long-term stability of Government incentives does not support the growth of this area effectively."[108]

"If there was more co-ordination across government departments so that the Department for Transport work was part of a considered cross-departmental approach, that would make it easier for the people who want to access this support and gain clarity as to how they could take this forward."[109]

"The difficulties of the current framework reflect the multiplicity of Government Departments involved, across Agriculture, Waste, Food, Forestry, Energy, Local Government, Business and Skills."[110]

"Wider bioenergy sector development would benefit from greater coordination and integration between key Government departments such as DECC and DEFRA, on issues such as land use and sustainability." [111]

"A secure and long-term policy and regulatory framework is needed that reaches beyond 2020 to at least 2030 to provide certainty and stability for researchers and companies seeking to exploit bio-waste as a feedstock."[112]

67.  In contrast, it is unclear whether any particular Government department or Minister is leading on the development of a waste-based, high value bioeconomy. Dr Church, Director, Resource, Atmosphere and Sustainability, Defra, told us that:

"In this particular concept, I would not say that there is a department that takes the lead on it … We work together. We each try to align our objectives with the objectives of the other departments."[113]

68.  This approach may mean that it is difficult for industry to know where to turn. As Ms Munday, Director of Advanced Manufacturing and Services, Department for Business, Innovation and Skills, told the Committee:

"I would very much say to companies in that position, 'Come in and talk to our three departments'. We have various instruments, we know about how the Government systems work and we would certainly hope to navigate them through to a suitable vehicle."[114]

69.  This does not suggest that there is a clear policy framework or departmental lead to encourage industry investment and provide certainty. Protecting the environment from the harmful effects of waste will continue to be of utmost importance and we recognise the important functions undertaken by Defra and the Environment Agency in achieving this. We also recognise that Government departments already work together on waste policy, but consider that given the potential value of waste as a resource, there is a need for far greater coordination.

70.  We have heard that there are significant opportunities for the development of a waste-based, high-value bioeconomy in the UK. Given the right conditions, the market will be able to seize these opportunities. We are deeply concerned, however, that the Government does not have a coordinated, joined-up approach that would enable the potential of a waste-based bioeconomy to be realised. Considering the potential economic opportunities on offer, we consider that BIS should provide the strategic lead in this area, and ensure that a strategy is put in place to make the very most of waste as a resource.[115] BIS should ensure that policies are coordinated across departments to enable waste to be effectively used as a resource and to allow maximum value to be extracted from it, whilst at the same time ensuring that environmental impacts are carefully evaluated.

71.  We recommend that a Minister in the Department for Business, Innovation and Skills (BIS) is given responsibility for the development of a waste-based, high value bioeconomy. The Minister should be a champion for waste as a high value resource and should coordinate activities across Government. The Minister responsible should ensure the production of a long-term plan, with at least a 15 year horizon, to support the development of a high value waste-based bioeconomy. This plan should be produced by early 2015.

72.  The evidence we received suggested that other countries are currently ahead of the UK in terms of extracting value from waste. The Research Councils, for instance, noted that the UK is some way behind the US and Brazil in using waste to manufacture biofuels.[116] Solvert told us that despite significant demand, the UK has no domestic production of n-butanol or acetone from renewable sources.[117] Meanwhile, Brazil and China have both installed large production facilities. These various approaches may or may not be appropriate for the UK—as noted above, we would be very concerned if it were thought prudent for the UK to replicate Germany's deployment of anaerobic digestion facilities—but we are concerned that the Government do not appear to monitor the approach in other countries to making use of waste as a resource.[118]

73.  We believe that important lessons can be learnt from the approaches taken in other countries, which the UK will wish either to follow or avoid. The UK lags behind some other European countries in that it continues to send waste to landfill, and also exports waste as it lacks sufficient infrastructure to extract value from it. Although this currently represents a problem, as stated earlier, it also represents an opportunity. Whilst some other countries have over capacity in energy from waste facilities or anaerobic digestion, the UK has the opportunity to develop infrastructure which can deliver higher value products from waste. In essence, the UK has the opportunity to leap-frog the mistakes made elsewhere.

74.  In developing a long-term plan for a high value waste-based bioeconomy, we recommend that the Department for Business, Innovation and Skills examines the strategies used by other countries to extract maximum value from waste, both successes and failures, and identifies approaches which would afford the UK the greatest economic opportunity.

Research and Development

75.  Throughout this inquiry, we have heard that the UK has key strengths in its research base, which would allow it to excel in developing a waste-based bioeconomy. As Research Councils UK (RCUK) told us:

"The UK is also fortunate in that it has highly competitive academic groups and a range of dynamic small companies able to develop ideas rapidly. In addition, the UK has significant strengths in the new bioscience technologies that will underpin future developments in IBBE [Industrial Biotechnology and Bioenergy]."[119]

76.  Professor Shah from Imperial College London expressed similar views, but noted that a shift is needed to expand effectively into new disciplines:

"We have in the UK a fantastic bioscience and bioprocessing community, but that research and industrialisation has been oriented around healthcare and the pharmaceutical sector. It is more or less the same skills, together with process engineering and chemistry physical science skills that can orient themselves around this sector. It is getting those different experts mobilised and especially working on industrialisation rather than discovering new things."[120]

77.  We nonetheless heard many examples of exciting areas of research currently underway at universities, institutes and in businesses around the UK. Support from the Research Councils and the Technology Strategy Board is essential to nurture success in this area.[121] RCUK indicated that research relevant to waste and the bioeconomy is funded through programmes across different research councils. Industrial biotechnology and bioenergy is identified as a key area in the Biotechnology and Biological Sciences Research Council's (BBSRC) strategic plan. In addition, the sustainable use of natural resources is identified in the Natural Environment Research Council's strategic plan. The Engineering and Physical Sciences Research Council (EPSRC) have joint programmes for synthetic biology with both BBSRC and the Technology Strategy Board (TSB). Separately, the EPSRC funds doctoral training centres in Industrial Biotechnology at UCL and Newcastle University. Although there is much promising R&D underway, only a proportion is focused on the use of waste as a feedstock, or on the development of high value products.

78.  The TSB funds pre-market research in collaboration with industry. It funds research relevant to waste and the bioeconomy through its industrial biotechnology, resource efficiency and synthetic biology programmes.[122] As well as its research programmes, the TSB also funds Catapult Centres and Knowledge Transfer Networks, described later in this chapter. As with the Research Councils, the TSB informed us that their programmes:

"… do not directly focus on waste, but use whatever feedstock is available at the required quantity, quality and cost. The focus is on using biological systems in manufacturing to access novel products and processes, not on the exploitation of waste. However, a number of projects we have funded do use various forms of waste or low value biomass …"[123]

79.  Whilst noting that there has been reasonable cohesion between the funding bodies, the Industrial Biotechnology Leadership Forum told us that:

"The funding strategy to date has been focussed on the technology required to process feedstocks (e.g. industrial biotechnology) or on final product targets (e.g. bioenergy/biofuels) and therefore a single co-ordinated funding strategy for waste valorisation does not exist."[124]

80.  Much of the research described in the evidence we received is related to the use of biomass, but not specifically to making use of waste. The evidence suggested that mechanisms for funding research into the exploitation of waste should be strengthened:

"Currently, there does not appear to be any effective mechanisms in place for funding cross disciplinary research between the Research Councils and the Technology Strategy Board that would underpin the science and technology for the exploitation of bio-wastes. The Research Council (RC) supports blue skies research whilst Technology Strategy Board (TSB) and Government are more related to applied research with close to market applications. There needs to be more joined up effort to coordinate funding with priority given and greater focus on bio-waste exploitation."[125]

"The Technology Strategy Board manages a number of grant calls to support technology commercialisation activities. As these are not exclusive to waste processing technologies they have only supported a handful of projects at sub commercial scale."[126]

81.  The evidence indicated that there may be benefits from opening a specific funding stream for multidisciplinary projects which bring together waste and the bioeconomy. The Royal Society of Chemistry stated:

"Greater multidisciplinary collaboration between scientists across disciplines should be enabled by bespoke funding sources. A big challenge for the chemical science community is that some chemists lack awareness of the many research opportunities in biomass conversion nor do they have an understanding of where they can play a role."[127]

82.  In January 2014, applications opened for the new Industrial Biotechnology Catalyst.[128] The Catalyst is co-funded by BBSRC, TSB and the EPSRC and will allocate £45 million of funding to multidisciplinary research and development projects in industrial biotechnology. It is intended to "accelerate the translation of Research Council-funded research into commercial products and processes."[129] This is an important development in terms of maximising the potential of industrial biotechnology as a whole and we welcome this investment.

83.  We believe that it is important that there is a shift from funding energy projects towards projects focusing on the development of higher value products. While we do not recommend that a specific funding stream is opened to ensure that the challenges of using waste as a feedstock are thoroughly researched, we would hope that the Research Councils and the TSB are alive to the burgeoning opportunities which we set out in this report. The two areas—waste and the bioeconomy—need to be brought together effectively if the UK is to succeed in exploiting this opportunity.

84.  We therefore recommend that the Research Councils and the Technology Strategy Board should collaborate to ensure that the funding environment nurtures research on extracting high value from waste and developing a bioeconomy in the UK.

Information on Waste

DATA ON WASTE

85.  The evidence indicated that considerable quantities of waste are produced, which could potentially be used as a resource for the bioeconomy. As noted in Chapter 2 of this report, however, there is sub-optimal information on exactly how much waste is available, where it arises, its quality, and the potential value which could be extracted from it. In addition, information about the environmental impacts of different uses of this waste could be improved.

86.  The Chartered Institution of Wastes Management (CIWM) told us that: "waste data collection in the UK tends to have concentrated on monitoring specific issues."[130] We heard that the amounts of waste which are generated by households are well recorded, whilst for other sectors, far more limited information is available. Dr Church from Defra told us:

"Household waste is about 13% by mass of waste generated in the country. We have quite good data about that because local authorities have a reporting obligation and they are the ones who generally collect that material through a system called waste dataflow."[131]

87.  WasteDataFlow is an online tool which allows local authorities to report municipal waste data to the Government.[132] In addition, Defra provide funding to WRAP to undertake research and data analysis on the composition and fates of waste from a range of different sources. CIWM told us, however, that the message from Government to local authorities was not to undertake waste composition analysis for municipal waste.[133] This is concerning as it is important for local authorities to have reliable information on waste arisings in their area and the Government should support local authorities in achieving this. On food waste, WRAP told us that:

"Whilst we now have a much better picture of where waste is arising within businesses and premises where food is prepared and served, we have a less clear picture on where the waste is consigned to in terms of disposal or recovery. WRAP has an ongoing work programme in this area …"[134]

We note that the current House of Lords EU Agriculture, Fisheries, Environment and Energy Sub-Committee inquiry on food waste prevention has heard that there is a need for improvement in data collection in some areas.

88.  As noted by Dr Church, limited information is available on waste from commercial and industrial sources:

"For commercial and industrial waste, the data is much, much, much less good. We effectively have three data points for surveys that have been done for businesses over the past 10 or so years. They are incredibly expensive surveys to run and even then you only touch perhaps 2,000 or 3,000 or 6,000 businesses. But still, compared to the 5 million or whatever it is businesses, it is a very small number. They do not tend to be compositional analyses. We understand and believe that the large waste management companies probably have far better data than we do and we have made several attempts to get them to share it with us and we continue to do so."[135]

89.  In their written evidence, CIWM referred us to a recent speech from their president, Mr. Beadle, in which he commented on the paucity of data on commercial and industrial wastes:

"… on a wave of poor data and understanding, and a tide of failure to plan or secure feedstocks, we are sailing steadily towards a market failure to recover resources or value from up to 15 million tonnes per year of wastes from businesses in the UK and Ireland. Failure to secure adequate C&I [commercial and industrial] infrastructure will lock us into either continued landfill or reliance on export markets which may or may not be there in the future … publicly available data is poor and patchy, course grained, gathered for different purposes and hard to compare from source to source. It throws into stark relief how poorly informed we are as a sector to make robust, strategic decisions about the future delivery of waste infrastructure."[136]

90.  We note that waste management firms may consider that holding exclusive access to data on waste helps to put them at a competitive advantage. The result, however, is a fragmented picture whereby no firm has a complete overview of waste arisings, which would allow it to develop an approach to maximise the value of waste as a resource. A recent report for the CIWM stated that a lack of reliable data is a key barrier in convincing financial backers that a proposed facility will be viable.[137] This report noted that stakeholders have concerns that at present public data on commercial and industrial waste takes too long to become available, quickly becomes out of date, is of limited accuracy, and is rarely available at the subregional level.

91.  In January 2014, a new online tool for recording waste from business, called 'edoc', was launched.[138] Edoc provides an alternative to the current requirement for businesses to fill in waste transfer notes to record the disposal of their waste, lightening the regulatory burden. It also makes it easier for businesses to obtain information about the waste they are producing. As noted by Mr. Beadle, the president of CIWM:

"Edoc data can be interrogated at a strategic level without disclosing commercially confidential detail, and making sure that businesses understand this protection is vital to gaining broad uptake across the industry."[139]

92.  As we heard during the inquiry, the roll-out of edoc creates an opportunity for improving information on waste.[140] The use of edoc is voluntary, and businesses can continue to use the previous system, and so its success will depend on levels of uptake. We therefore encourage businesses and waste management firms to make use of this system. As this will be a key tool for monitoring commercial and industrial waste, the Government will wish to monitor uptake closely.

93.  The CIWM report notes concern from some stakeholders that edoc may not provide sufficiently accurate information on waste.[141] It will be important for businesses and the Government to work together to make sure edoc delivers useful information on waste as a resource. As it will take a number of years for data from edoc to accumulate, there would also be benefits from the waste management industry working with the Government to share existing data and establish improved historic data sets.

94.  It is necessary to be able to measure waste effectively in order to manage it as a resource. To enable the maximum value to be extracted from waste, a more robust baseline of waste produced by different sectors is needed. This should comprise information on sources of waste, quantities, composition, location and changes over time. It may also comprise information on the potential energy or value which can be extracted from waste resources. This information should be made easily available to potential users. It should provide sufficient detail so that waste management companies and other potential investors can make informed decisions about where to site a facility and what kind of facility to put in place in order to extract maximum value from waste.

95.  Creating a comprehensive pool of data on waste would have great benefits in enabling waste to be more effectively used as a resource. Information about the location and timing of waste arisings would help inform the siting of facilities and allow economies of scale to be realised. It would reduce uncertainty about the availability of waste and so reduce the risks of investment. If all waste management firms contributed to such a data source, all could benefit.

96.  The Government will need to determine how this could best be achieved and who should take ownership of providing this information as a publicly available resource. Dr Wylie, co-founder and chairman of WHEB, a sustainability-focused investment firm covering private equity, listed equities and infrastructure projects, told us that what was needed was, "a unified resource collecting all the information and that WRAP could be very useful in a recharge-type role, a more proactive role."[142] As we heard, it is also important that this information on waste is embedded as part of holistic mapping of material flows across the economy and is used to inform circular economy approaches.[143]

97.  It is clear that improved data collection and data analysis will help to support the Government in evidence based policy making. Making this information publicly available, easily accessible and possible to interrogate will help businesses to make investment decisions. Whilst there are some encouraging signs, and the work of WRAP, CIWM and others is to be commended, further work is needed to improve the information available on waste in order to help open up the market to potential investors. We suggest that WRAP may be well positioned to take ownership of providing holistic information on waste resources. In this regard, we are concerned that recent reductions in its budget may not leave it well placed to do so.[144]

98.  Defra has indicated that it intends to step back from policy work "in areas such as commercial and industrial waste and construction and demolition waste."[145] We are aware that in a resource constrained environment it is necessary for the Government to prioritise and it is right that industry should be expected to take a greater role. There are clear benefits to industry in taking steps which will enable waste to be used as a resource and we would encourage industry to grasp this opportunity. The evidence we have received indicated that the availability of reliable data is of key importance. We consider that the Government needs to play a catalytic role in developing a framework for the provision of data and bringing industry together.

99.  We recommend that the Department for Business, Innovation and Skills takes steps to ensure that information on both domestic and non-domestic waste streams is collated in a way which enables it to be used as a resource. Information on sources of waste, quantities, composition, location and changes over time needs to be made available in a way which allows industry to make informed investment decisions on how to extract maximum value from waste resources. Industry needs to engage with the Department for Business, Innovation and Skills as a matter of urgency to agree ways in which this can be achieved for non-domestic waste streams. A clear owner needs to be identified to collate, and make available, such holistic information on waste as a resource. This may be an evolution of the functions of the Waste and Resources Action Programme (WRAP). The Department for Business, Innovation and Skills should draw upon this improved information in producing the long-term plan for a high value waste based bioeconomy.

WHOLE SYSTEMS ANALYSIS

100.  Several witnesses told us that there is a need for improved whole systems analysis of the economic and environmental impacts of processes and products. As seen in Chapter 2 of this report, there are challenges with Life Cycle Assessment—using different approaches can deliver different results.

101.  We received many different estimates of the environmental and economic potential of different technologies. In order to be able to compare evaluations of different uses of waste, independent audit is needed. Richard Barker from Biogen, a company specialising in the anaerobic digestion of food waste, was asked about who should take ownership of whole systems analysis. He stated:

"It should not be industry because there are a lot of biases that are introduced to that system view. … Taking a step back and providing a system view is not best left in any of the particular industry groups that clearly favour their own membership."[146]

102.  Mr Barker considered that the Government or a Government sponsored independent institution needed to be responsible for whole systems analysis to ensure that industry was not favouring its own technology. Mr Jones called for the Government to take a role in benchmarking the scientific credibility of processes, referring to economic and environmental impacts.[147] From an investment perspective, Dr Wylie did not consider this necessary, stating that the customers' view of the market place would be more important.[148] If the Government wishes, however, to use incentives to support the adoption of greener technologies, they will need to take ownership of common approaches to whole systems analysis to avoid distorting the market. Incentives, including the development of standards for bio-based products, are discussed further later in this chapter. It is important that claims of environmental benefits, used to support planning decisions or standards for bio-based products, can be independently audited.

103.  We recommend that the Department for Business Innovation and Skills takes steps to ensure that consistent approaches to whole systems analysis are adopted to ensure that the environmental impacts of processes and products can be compared effectively.

Availability of Waste

WASTE COLLECTION AND PLANNING

104.  The policies of local authorities on waste collection and the planning of waste infrastructure impact on the availability and quality of the waste resource and the possible economic returns from its use. Although household waste is only about 13% by mass of waste generated, it is nevertheless a valuable resource. Policies vary markedly and it is not clear that waste is always collected and treated in a way that maximises its economic value. Moreover, a complex picture emerged in terms of responsibilities, divided between Government departments and local authorities.

105.  In essence, local authorities are responsible for putting in place strategies for domestic waste collection which are appropriate for their areas. Mr Woodruff, Chair, National Association of Waste Disposal Officers and Head of Waste Services, London Borough of Bromley, explained:

"Broadly, we collect what households no longer want and try to do the most beneficial thing that we can find to do with it, in line with the waste hierarchy and other drivers, and as economically beneficially as we can."[149]

106.  Defra told us that they work with local authorities by funding WRAP:

"… we part-fund WRAP. We fund it entirely in England. WRAP works with local authorities to help them understand the costs and benefits of taking that kind of action. It shows good practice: this council over there did it and this is what it cost them; that council over there did it and that is what it cost them, and so on. We also have provided money through, as I said earlier, the weekly collection support scheme that DCLG ran."[150]

107.  In November 2012, the Department for Communities and Local Government (DCLG) announced £250 million of funding to incentivise local authorities to put in place weekly waste collection and separate food waste collection. In January 2014, DCLG published its Guidance on Weekly Rubbish Collections describing how "councils can and should deliver weekly rubbish collections." [151] DCLG also has a role in waste planning:

"… the planning system is like an anchor because it provides the waste management facilities of the right type, in the right place and when they are most needed. In doing so, planning legislation puts the emphasis very much on local authorities to put in place robust plans setting out their vision for the next 10 to 15 years about waste management arisings and how to deal with it. What we do in DCLG is create the framework for doing so through the National Planning Policy Framework and, for the moment, Planning Policy Statement 10, which sets out the key principles that local authorities must have regard to when preparing their spatial vision for their area."[152]

108.  For a waste based bioeconomy to thrive, waste needs to be collected and treated in a way which maximises its potential to be used as a resource. Mr John Woodruff, Chair, National Association of Waste Disposal Officers and Head of Waste Services, London Borough of Bromley, told us how collection practices had developed:

"I noticed in a previous session that there was a question about why local authorities collect stuff in the way they do and why it is different everywhere. It is a common question. I think it is a very valid question. Is there a single best way of doing it? There might be. We are working towards it. Generally, if you will forgive the unintended pun, local authority schemes tend to have grown organically to where they are and from where they started. Their nature very much depends on when and where they started."[153]

109.  At present, different approaches across local authorities in England result in a complex landscape for potential investors wishing to use waste as a resource:

"The waste supply chain is fractured in nature. Different approaches to recycling and the use of green waste result in differing pictures as to the reliability of waste sources and uncertainty from the point of view of investors."[154]

"Half of English local authorities now collect household food waste but only 50% of these collect food waste as a separate collection. The other 50% collect food waste with green waste. Where food waste is separately collected it will be treated at anaerobic digestion plants to generate energy and fertiliser. Where it is collected with green waste the collected material is composted."[155]

110.  In general, less energy is required to extract value from homogenous wastes than from mixed wastes. In this regard, separate collection is therefore preferable, although as noted by a Defra official, there are costs associated with this and also practical implications:

"On the food waste question, I fundamentally disagree … that there is a single right way to do it because, apart from anything else, I do not know where you live, I know where I live … I have the ability to store dozens of bins if I wanted to. Down the street from me is a set of properties straight on to the street that are flats, they have little or no storage space. How you store, collect, separate, sort and deal with the waste from those two properties is not the same if you want to get good separation. That is why I fundamentally disagree … that there is one single right way of doing that thing."[156]

111.  This argument, however, rather begs the question of how many 'right ways' there may be of collecting waste. There may be no single, universal, collection method which all local authorities can apply, but both greater consistency and ambition should be aimed for. In addition to DCLG's Guidance on Weekly Rubbish Collections, we also note the recent letter from Lord De Mauley, Parliamentary Under Secretary of State at Defra, to local authorities. This letter reminded local authorities of new regulations coming into force in January 2015 affecting the separate collection of waste paper, plastic, glass and metal.[157] It will be important that local authorities are encouraged to be ambitious and are well supported in implementing separate collection of these wastes and also biowastes, and are provided with clear guidance to support them in doing so. We note that targets incentivising local authorities to collect greater volumes of recyclables do not automatically incentivise higher value uses.

112.  It would be useful to find effective ways of engaging those with an interest in extracting value from waste so that they can articulate needs in terms of composition of waste. This, along with the needs of local communities, should inform approaches to the collection and treatment of waste. If value can be extracted from waste, this should help to make improved collection practices financially viable.

113.  The Anaerobic Digestion and Biogas Association noted large differences in waste collection practices between England and the devolved administrations:

"While 95% of Welsh councils have separate food waste collections and all non-rural Scottish local authorities will do by 2015, only 27% of English local authorities have separate food waste collections. This is helping to contribute to the situation today whereby only 7% of food waste is being treated through AD, while 35% is still landfilled."[158]

114.  This variability raises questions as to why the devolved administrations have been able to put in place more ambitious policies on waste collection. Mr. Woodruff told us that progress was being made with waste collection in England:

"On the collection side, where we used to drive around and collect stuff in dustcarts, you can now have a collection vehicle that has two, three or four compartments that allows you to collect multiple materials on the same journey, which is far more effective. So we are changing what we do. We are searching for the best way of doing it."[159]

115.  In addition to waste collection practices, the availability of waste is also influenced by the type of contracts local authorities put in place with waste management, treatment or disposal firms:

"County or Unitary Authorities tend to commit to long term commercial waste treatment agreements to secure the significant infrastructure investment required for the chosen waste treatment solutions and to provide fundable long term economic certainty for their waste management requirements."[160]

116.  Others also told us that the availability of waste is affected by long contracts.[161] A proposal to use waste as feedstock to create chemicals, biofuels and energy in the Tees Valley notes the impact of long term contracts on the availability of waste and the need to import waste to make sure enough is available.[162] Long term contracts are important for local authorities in securing investment and for business in making investment decisions. We note, however, that long term contracts for lower value uses of waste may also act as a barrier as technologies to make higher value use of waste come on line. It will be important that local authorities are well supported in keeping abreast of developments in technology and in making sound decisions, which enable the highest possible value to be extracted from waste in the long term. In some cases, it may be necessary to consider the renegotiation of existing contracts to allow higher value uses of waste resources.

117.  In their written evidence, CIWM referred us to a recent speech from their president, Mr. Beadle, in which he stated:

"We have poor or poorly defined co-ordination between planning authorities, again especially here in England. Planning guidance is currently being reviewed [by DCLG] but CIWM remains concerned that we have lost some of the bigger picture in looking at wastes as resources at a regional or sub-regional level. We need to get it back."[163]

118.  Whilst DCLG provide the planning framework, we heard that Defra provides advice to local authorities, through WRAP, as to which type of waste facility would be most appropriate.[164] It will be important that, in providing advice to local authorities, the Government remains fully appraised of recent and future developments in technology for extracting value from waste.

119.  While welcome progress on waste collection has been made, and while we note some of the practical difficulties for households in sorting waste, it is not clear why there cannot be greater consistency in waste collection by local authorities in England when this has been achieved in Wales and Scotland. We note the £250 million of funding provided by DCLG, along with their recent guidance advocating weekly bin collections. Such funding is welcome, but might be usefully diverted towards collection practices which enable the waste to be most effectively used in a high value bioeconomy, rather than focussing on weekly collection practices. Funding and guidance for local authorities should be informed by a robust evidence base taking account of social, environmental and economic needs.

120.  The Department for Business, Innovation and Skills, in developing a long-term plan for a high value waste-based bioeconomy, should ensure that waste is collected in such a way as to enable it to contribute fully to a high value waste-based bioeconomy. To this end, we recommend that the Department for Environment, Food and Rural Affairs and the Department for Communities and Local Government adopt a far more ambitious approach to waste collection in order to ensure that waste is collected and treated in a way that maximises the potential for it to be used as a resource. To enable this, we recommend that local authorities are offered further guidance to enable them to put in place waste collection facilities, and make planning decisions on waste infrastructure, which maximise the value which can be extracted from waste. We recommend that a long-term policy goal should be the creation of a more standardised system of waste collection across local authorities which views waste as a valuable resource.

EXPORT OF WASTE

121.  The UK exports a large amount of waste. The evidence suggested that the export of waste from the UK to Europe represents a lost opportunity for the bioeconomy. INEOS Bio told us that:

"The amount of SRF [Solid Recovered Fuel—an engineered fuel produced from household and commercial wastes and meeting a defined specification] that the UK exported in 2012 to other European Member States for use in energy from waste plants was 739,535 tonnes. This number is increasing year on year. If this material were to be used in the UK, rather than be exported, it would result in around 150,000 tonnes of bioethanol. It would create skilled UK jobs in the emerging bioeconomy, reduce CO2 emissions from UK transport, and reduce our need for imported fuels and energy."[165]

122.  Air Products PLC expressed similar concerns:

"… rapidly increasing rates of refuse-derived fuel (RDF) exported to the continent are hindering the development of UK energy-from-waste facilities and pose a significant risk to the viability of future projects. The increase in RDF export (from 0 to almost 900,000 tonnes per year in the last 5 years) has been caused by rising landfill costs in the UK, the slow development of UK waste conversion capacity and the rapid expansion of the Northern European incineration capacity. The export of RDF from the UK is clearly currently a commercially attractive option which is depressing gate fees[166] in the UK and causing concern for Air Products given that up to a third of our project revenue is expected to arise from gate fees. This trend is not only undermining the development of energy-from-waste infrastructure in the UK, it is also effectively exporting valuable green jobs and renewable energy resource."[167]

123.  Air Products PLC told us that they had been in communication with Defra about the export of waste, but reported delays in the Department proposing and consulting on a way forward. The export of waste represents a lost opportunity for nurturing a bioeconomy in the UK. The Energy Technologies Institute argued that a lack of UK market opportunities was leading to a rapidly growing export market in UK Refuse Derived Fuel (RDF) going to European energy from waste (combustion) plants:

"This may have increasing undesirable social, political and environmental consequences, such as the increased greenhouse gas emissions associated with transporting and disposing of 'our waste' abroad, and will certainly lead to competition for domestic feedstock markets as they develop. Therefore there is an opportunity for future policy and regulatory frameworks to encourage the more sustainable 'local' treatment and conversion of domestic waste in the UK."[168]

124.  We agree that it must make sense, both environmentally and for UK businesses, for policy and regulation to be directed, if at all possible, at ensuring that UK waste is treated and converted in the UK. As we were drafting this report, the Government acknowledged concerns about the growing export market in RDF:

"We are aware of concerns about the recent increase in exports of refuse-derived fuel and its effect on gate fees in the UK. We intend to publish a call for evidence shortly that will seek evidence on the market for refuse-derived fuel and the extent to which a market failure might exist. This will enable us to assess the effect of increased exports on the UK market for refuse-derived fuel, including its impact on gate fees."[169]

125.  We look forward to this consultation and recommend that the Department for Business, Innovation and Skills, in developing a long-term plan for a high value waste-based bioeconomy, takes its findings into account.

126.  We note that were BIS to enable a waste-based bioeconomy to flourish in the UK, as we recommend, it is likely that less waste would be exported.

Stimulating Investment

REDUCING RISK

127.  Reducing the risks of investment is vital if pioneering research is to be brought to the market place. One of the most challenging, costly and risky stages of technology development is the scaling up of processes to the commercial scale. The Government, through the Technology Strategy Board, has invested in facilities to support this scaling up and so reduce commercial risk. Crucial in the context of this inquiry is the Centre for Process Innovation (CPI—see Box 3 below), one of the seven centres that make up the High Value Manufacturing Catapult. This is the largest of the Catapult centres recently set-up by the Technology Strategy Board. The Catapult centres aim to help turn innovative ideas into commercial realities by bridging the gap between universities, research institutions and industries. As such, the CPI works to transfer technology concepts from research to proven market ready commercial processes and technologies. This activity involves moving products and technologies across the so-called valley of death between technology readiness levels (TRLs) 3 and 7.[170] The CPI offers open access to facilities so that industry can rigorously test and refine their new products.

BOX 3

Centre for Process Innovation

The Centre for Process Innovation (CPI) hosts equipment and provides expertise to help industry partners develop and scale up processes and prove new products prior to commercialisation. Partners are able to develop whole processes, from the treatment of raw feedstocks, such as waste, right through to the final product. CPI has a range of equipment which can be used in various combinations to identify problems and eliminate poor processes, before developing a final process plant, which can be used in commercial production. CPI therefore reduces risk for its partners by reducing the cost and increasing the speed of development programmes. CPI has over £80m of open access assets for process development and proving. Partners use this to develop and commercialise new products and processes. CPI owns and operates the two scale-up and proving plants that make up the National Industrial Biotechnology Facility as well as having a dedicated bioprocess development laboratory. It also has a Thermal Technology Centre in collaboration with Tata Steel. This centre uses high temperature processes for the creation of value from wastes. This equipment can help companies scale processes up to 10 tonnes a day so they can prove their processes on a commercial scale.[171]


128.  The CPI is regarded as having been successful in supporting industry to test, develop and scale up products and processes, and we were told in November 2013 that the CPI's biological facility was fully booked up until Easter 2014.[172] While this is to be welcomed, it implies that potential partners are being denied access. The CPI told us that it is underfunded compared to other countries:

"… the UK still needs to invest more in integrated innovation systems if it is to increase the value created from its investment in the chain. Currently the HVM Catapult and CPI are underfunded relative to similar centres in the UK's competitor countries. Significant further benefit could be secured by increasing investment in the innovation chain."[173]

129.  Dr Hillier, Director of Strategy & Futures, Centre for Process Innovation & CTO, High Value Manufacturing Catapult, stressed the importance both of funding and the TSB having a sufficiently long horizon:

"We need our research councils and we need the TSB to be joined up to be able to fund these things, and that means TSB funding is probably inadequate to do the amount of things it needs to do. Also the horizon that Will [Dr Barton, Head of Manufacturing, Technology Strategy Board] and his team can see forward is much too short. I was on the Centre for Doctoral Training panels last week, and they were giving grants that were going to last for five years to create a cohort of people that can go into manufacturing and make things happen. That is fantastic. But if the TSB does not always have that five-year horizon in front of it as well, it is going to be very difficult because it takes 10 to 15 years to get from a research idea in the lab through to something where you can build a factory that is going to manufacture something."[174]

130.  Support for such facilities is critical to UK plc. RCUK, for example, observed a lack of large companies with the financial backing to develop the whole process from waste feedstock to high value product:

"Whilst the UK has many excellent academic groups and active small companies developing new technological approaches, the UK appears to lack sufficient numbers of large companies in this area who have the financial backing to develop a whole "process", integrating a range of technology platforms, taking feedstocks to end product(s)."[175]

131.  In addition to the Catapult Centres, the provision of demonstration facilities across the piece, we were told, is vital. Dr Philp from the OECD, but speaking in an individual capacity, explained:

"Demonstrator plants are larger than pilot plant but smaller than full-scale production plants. Many of the technical, supply chain and economic issues become apparent, and can therefore be addressed, at the demonstrator phase. It is therefore a vital stage to prevent very expensive mistakes at the full-scale production phase. And yet demonstrator plants are notoriously difficult to fund, and this calls for public intervention, ideally through public-private partnerships (PPPs)."[176]

132.  We heard concerns about the provision of demonstration facilities. Dr Green, Founder and Chief Scientific Advisor, Green Biologics, told us:

"We have benefited greatly from TSB support for early stage research and development, but our challenge now is how can we get technology out of the lab and into demonstration projects. We have had to do this outside the UK because demonstration facilities simply do not exist in the UK. More could be done to support process demonstration, which is a vital thing … to derisk the whole process and to get the investment for a commercial project."[177]

133.  Dr Green informed us that new demonstration facilities were reasonably imminent but it had taken some time for them to come to fruition:

"There are at least two new things that are coming up. One is through the Department for Transport. They are looking to fund advanced biofuel demonstration projects, and that is something that will be greatly beneficial for us. Also, there is a pan-European initiative as well that is going to fund demonstration projects that we could tap into. Those are two examples where funding is starting to come through but it has taken a while."[178]

134.  British Airways stressed the importance of Government support to reduce the risk of high capital intensive projects:

"There is a strong need for government support to get demonstration scale technologies into operation as well as to help finance first-of-a-kind projects at commercial scale. Although the Green Investment Bank is tasked with helping renewable projects get to financial close, there is still a reluctance to move away from traditional waste treatment technologies such as incineration. Advanced gasification is almost twice as efficient at converting the valuable carbon contained in waste into energy than the traditional incinerators it will replace. High capital expenditure projects that have not been successfully demonstrated at commercial scale require government support."[179]

Dr Philp told us:

"We have all said that the demonstrators are totally crucial. Anybody from the oil and gas business will tell you: you make your mistakes at demonstrators before you go to full scale. It might look great on the bench and you build a full-scale plant, but something economic or technical does not work."[180]

135.  Knowledge Transfer Networks (KTNs) are also very important in this area. There are 15 KTNs which are funded by the Technology Strategy Board. KTNs facilitate networking, communication and collaboration between UK businesses, research organisations, universities and technology organisations working in specific areas.[181] KTNs highlight recent developments, events and funding opportunities through the connect on-line portal. They are also able to provide advice to the Government on the technological needs of the sector and specific issues which either enhance or inhibit innovation. The TSB has announced that it is setting up a new body, from 1 April 2014, to continue and invigorate the work of the KTNs. Knowledge Transfer Network Ltd "will bring the previously separate KTN communities together under one umbrella, to enable greater opportunities for collaboration, provide even more invigorating networking opportunities and make cross-cutting activity across disciplines easier."[182]

136.  Our attention was also drawn to the work of the Green Investment Bank (GIB). The GIB provides funding for sustainable projects and waste has been chosen as a priority sector for investment.[183] BIS confirmed to us that, with respect to waste, the Green Bank was currently mainly funding anaerobic digestion projects. Dr Wylie, co-founder and chairman of WHEB, a sustainability-focused investment firm covering private equity, listed equities and infrastructure projects, urged the Government to take further steps to: "build on what you have already with organisations to catalyse investment such as the Green Investment Bank."[184] It is early days for the GIB and it will be some time before its success can be adequately measured, but we heard that it has made a sound start.

137.  We recommend that the Department for Business, Innovation and Skills (BIS) ensures that sufficient funding is given to knowledge transfer and near market research and that there is adequate capacity in demonstration facilities across the UK. In particular, BIS should regularly review whether the capacity of the High Value Manufacturing Catapult continues to be sufficient to support projects, particularly at later Technology Readiness Levels. In addition, we note that the Green Investment Bank has made a promising start in helping to reduce the risk of high capital intensive projects. To this end, we recommend that successive Governments support its mission.

INCENTIVES

BOX 4

Incentives

The Renewables Obligation requires UK electricity suppliers to source a specified proportion of electricity from renewable sources.[185] Generators of renewable electricity are issued with Renewables Obligation Certificates (ROCs), which they sell to energy suppliers. There is no fixed price for a ROC. The number of ROCs awarded to an electricity generator depends on the technology used to generate the renewable electricity. For example, electricity produced from AD currently receives 2 ROCs per megawatt hour, the highest possible number.[186] Energy from waste with combined heat and power receives 1 ROC per megawatt hour.


The Feed-In Tariffs scheme aims to promote the uptake of small scale renewable and low carbon electricity generation technologies. Registered small scale generators are paid for the electricity produced by licensed electricity suppliers.[187]


The Renewable Heat Incentive[188] provides financial incentives for the uptake of renewable heat. Participants in the scheme are paid for generating and using renewable energy to heat their buildings. Different technologies are paid different amounts per kilowatt hour and there are incentives for biomass units and anaerobic digesters.


The Renewable Transport Fuel Obligation (RTFO) requires transport fuel suppliers to incorporate a specified percentage of fuel from renewable sources, which meet defined sustainability criteria, or pay a financial penalty.[189] Owners (at the point of duty) are awarded one Renewable Transport Fuel Certificate (RTFC) per litre of biofuel or kilogram of biomethane. Biofuels produced from certain feedstocks, including wastes and residues, receive double the amount of RTFCs. The evidence we received suggested that the effectiveness of the RTFO is reduced as fuel is taxed by volume rather than energy content.[190]


In addition to these incentives, funding is also provided directly to support specific technologies. For example, Government has provided funding for AD, advanced gasification projects and facilities for energy recovery from residual waste.


138.  We heard that the plethora of incentives, as described in Box 4, was distorting the market and pushing waste towards lower value uses.[191] Sector specific incentives for heat, biofuel and energy are contributing to an unstable policy environment overall. The Government maintain that they do not and should not back certain technologies,[192] but the miscellany of incentives, encouraging energy generation rather than higher value uses, makes us call this into question. Different industries are offered different incentives, favouring some, discriminating against others:

"The legislative and fiscal dynamics are currently pulling in different directions. Industries such as power production from anaerobic digestion are heavily subsidised to the point where chemical production, which would compete for the same feedstock in a non-subsidised market, only provides marginal returns and is therefore unlikely to see the investment due to the additional technical and commercial risk, even though in the long-term it provides the best economic solution for UK Plc. … there are currently no incentives for the production of green chemicals and therefore most activity is towards the heavily incentivised energy from waste market."[193]

139.  Dr Hillier, Director of Strategy & Futures, Centre for Process Innovation & CTO, High Value Manufacturing Catapult, put it to us that:

"We have focused a lot on the fact that you need this integrated technology chain to get things through to the end, but when you get to the end, if you do not have the funding, the incentive, the users, the long-term support from the regulatory system you will not succeed, even if you have the best technology in the world, you are never going to invest in it in the UK. This whole focus on how you join up the technology chain and the delivery of the new technology into the market is vital. This is particularly true if we are talking about biowaste. There is a need to incentivise the diversion away from incineration into added value. It is an important factor in the success making it all happen because technically we can do it."[194]

140.  Solvert, a company specialising in the development of technology to produce renewable chemicals from sustainable raw materials, specifically the organic fraction of waste, stated:

"There are currently no incentives for the production of green chemicals and therefore most activity is towards the heavily incentivised energy from waste market."[195]

141.  The Centre for Process Innovation argued that if a bioeconomy was to be grown, then current incentives must be looked at:

"This market would grow significantly more quickly if incentives were created to encourage production of high value products. The current incentives to use wastes for energy production and the lack of incentives for high value chemical production, combined with long-term waste processing agreements distort the market and make it unattractive for significant investment in high value chemical production. … policy instruments remove feedstock that could be used for the bio-economy from the available pool and destroy it. If there is a strong desire to grow the bio-economy then the incentives and funding environment needs to be changed to support it."[196]

142.  British Airways told us that the aviation sector was excluded from incentive mechanisms:

"A significant challenge to the aviation sector is that it is often excluded from incentive mechanisms—for example road transport fuels in the UK are eligible for Renewable Fuels Transport Certificates that can be traded, whereas aviation fuels are not. This has been addressed by some governments, for example, the US Renewable Fuels Standard allows both fuels to earn these types of credits."[197]

143.  In addition to hearing widespread concern that current incentives were distorting markets, we also heard that even where support mechanisms were in place, incentives were not aligned across a sector:

"A range of support mechanisms exist to incentivise and enable bioenergy utilisation (the Renewable Obligation, Renewable Heat Incentive and Renewable Transport Fuel Obligation). However, these mechanisms are not fully aligned across bioenergy uses and the market does not yet have the confidence that they will offer sufficient support levels in the period required for significant R&D investments."[198]

144.  We were told that whilst an array of incentives for heat, energy and biofuel were in place, there were no incentives for bio-based products such as plastics or chemicals. We heard that standards for bio-based products were needed. Bio-based standards—something similar to a kite-mark—would help to enhance market transparency by providing common reference methods and requirements in order to verify claims about products (e.g. bio-degradability, bio-based content, sustainability). Certifying a product as 'greener' could help to enhance its desirability and increase its market value relative to equivalent products. The Industrial Biotechnology Leadership Forum told us:

"… more could be done by Government to support innovation in waste minimisation and utilisation. One such idea could be the introduction of a UK scheme similar to the 'Biopreferred'[199] programme used in the USA, which actively endorses and promotes the purchase of biobased products, particularly across Government departments. This could certainly act as a stimulant for research and development in this area."[200]

145.  Such standards are being pursued at an EU level. We note this development and the University of York's assertion that: "Future European standards on bio-based content will encourage greater use of bio-feedstocks."[201] British Airways called for further work to develop sustainability standards for biofuel.[202] This would give biofuels produced from waste, or from sustainably sourced biomass, an advantage.

146.  Again, adopting common approaches to LCA will be important in developing meaningful standards for bio-based products. As seen in chapter 2, there are currently challenges in that LCA can deliver different results depending on the approach used. It is important that the Government take an active role in supporting the development of standards for bio-based products at the EU and international level.

147.  It is clear to us that there is considerable concern and uncertainty about the range of incentives currently offered. The system is complex and may well be distorting the market, and working against the production of high value products. We believe that the tax structure should be clear, fair and not inhibit any business sectors.

148.  We recommend that the Department for Business, Innovation and Skills, in producing a long-term plan for a high value waste-based bioeconomy, reassesses the current approach of providing incentives to support specific sectors. The approach to the taxation and incentive structure should focus on providing policy stability, ameliorating market distortions and not inhibiting the extraction of high value from waste.


91   It is worth noting that HM Treasury, though we did not hear from them directly, clearly have an interest in aspects of our inquiry. Back

92   Government. Back

93   Q 143. Back

94   Q 109. Back

95   See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/78977/coalition_ programme_for_government.pdf. Back

96   See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/69400/anaerobic-digestion-strat-action-plan.pdf. Back

97   Government supplementary evidence. Back

98   Q 97. Back

99   TSB. Back

100   Q 65. Back

101   Q 81. Back

102   Peter Jones OBE. Back

103   Q 97. Back

104   Solvert. Back

105   Royal Society of Chemistry. Back

106   Centre for Process Innovation. Back

107   Q 144. Back

108   Water UK. Back

109   Q 78 (Dr Tattam, Director of Operations, Chemistry Innovation Knowledge Transfer Network). Back

110   Peter Jones OBE. Back

111   Energy Technologies Institute (ETI). Back

112   Royal Society of Chemistry. Back

113   Q100. Back

114   Q112. Back

115   We note that a recent report has called for a re-adjustment in how the Government perceives and values the waste sector. The report argues that: "waste as a government policy area should be renamed 'resources' and moved from DEFRA to BIS. From BIS it could be given strong sectoral support as a commercial opportunity." 2020 Productivity and Efficiency Group (2014) Sweating our Assets-Productivity and Efficiency Across the UK EconomyBack

116   RCUK. Back

117   Solvert. Back

118   Q 102 (Dr Church). Back

119   RCUK. Back

120   Q 66. Back

121   There are seven Research Councils with responsibility for different disciplines who invest in research. These are: the Science and Technology Facilities Council (STFC), the Natural Environment Research Council (NERC), the Medical Research Council (MRC), the Economic and Social Research Council (ESRC), the Engineering and Physical Sciences Research Council (EPSRC), the Biotechnology and Biological Sciences Research Council (BBSRC) and the Arts and Humanities Research Council (AHRC). The Technology Strategy Board (TSB) is a non-departmental public body, sponsored by BIS, which provides the primary means through which Government incentivises business-led technology innovation. The majority of the funding provided by TSB is matched by business. Back

122   TSB. Back

123   TSB. Back

124   IBLF. Back

125   End-O-Sludg. Back

126   Solvert. Back

127   RSC. Back

128   See: http://www.bbsrc.ac.uk/news/industrial-biotechnology/2014/140120-n-industrial-biotechnology-catalyst.aspx. Back

129   TSB. Back

130   CIWM. Back

131   Q 98. Back

132   See: http://www.wastedataflow.org/. Back

133   CIWM. Back

134   WRAP. Back

135   Q 98. Back

136   CIWM: David Beadle Presidential Inauguration speech http://www.ciwm.co.uk/web/FILES/PressRelease/David_Beadle_speech_transcript_final_151013.pdf  Back

137   CIWM (2013) Commercial and Industrial Waste in the UK and IrelandBack

138   See: http://edoconline.co.uk/. Back

139   CIWM: David Beadle, Presidential Inauguration speech. Back

140   Q 141 (Peter Jones OBE), Q 98 (Dr Church), Q 153 (Rt Hon Dan Rogerson MP). Back

141   CIWM (2013) Commercial and Industrial Waste in the UK and IrelandBack

142   Q 130. Back

143   Peter Jones OBE, International Synergies Limited. Back

144   Defra (2013) Review of Defra funding for WRAP. Back

145   Letter to stakeholders from the Rt Hon Dan Rogerson MP, Parliamentary Under Secretary for Water, Forestry, Rural Affairs and Resource Management https://www.gov.uk/government/uploads/system/ uploads/attachment_data/file/255508/waste-stakeholder-letter-131106.pdf. Back

146   Q 31. Back

147   Q 138 (Peter Jones OBE). Back

148   Q 138. Back

149   Q 115. Back

150   Q 104. Back

151   DCLG (2014) Guidance on Weekly Rubbish CollectionsBack

152   Q 117. Back

153   Q 115. Back

154   Wilson Steam Storage. Back

155   WRAP. Back

156   Q 109. Back

157   See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/250013/waste-seperate-collection-201310.pdf. Back

158   ADBA. Back

159   Q 115. Back

160   Solvert. Back

161   INEOS Bio, ETI. Back

162   Tees Valley Unlimited (2012) Creation of an Integrated Energy/Bioresources/Petrochemicals Cluster in the Tees ValleyBack

163   CIWM. Back

164   Q 119 (John Woodruff, Chair, National Association of Waste Disposal Officers and Head of Waste Services, London Borough of Bromley). Back

165   INEOS Bio. Back

166   The cost payable to waste management companies for handling waste. Back

167   Air Products PLC. Back

168   Energy Technologies Institute. Back

169   HC Deb, 11 February 2014, col. 578W. Back

170   TRLs are a technology management tool that provides a measurement to assess the maturity of evolving technology. Back

171   CPI. Back

172   Q 26 (Dr Hillier, Director of Strategy & Futures, Centre for Process Innovation & CTO, High Value Manufacturing Catapult). Back

173   CPI, Q 26. Back

174   Q 20. Back

175   RCUK. Back

176   Dr Philp, OECD (acting as an individual). Please also see: http://ec.europa.eu/dgs/jrc/downloads/events/ 20130425-ket-sme/20130425-ket-sme-crean.pdf. Back

177   Q 52. Back

178   Q 53. Back

179   British Airways. Back

180   Q 92. Back

181   See TSB website: https://www.innovateuk.org/-/knowledge-transfer-networks. Back

182   See TSB website: https://www.innovateuk.org/-/non-executive-chair-announced-for-new-knowledge-transfer-network-ltd-. Back

183   See: http://www.greeninvestmentbank.com/what-we-do/waste/default.html. Back

184   Q 142. Back

185   See: Gov.uk website. Increasing the use of low carbon technologies. The Renewables Obligation 
https://www.gov.uk/government/policies/increasing-the-use-of-low-carbon-technologies/supporting-pages/the-renewables-obligation-ro. 
Back

186   See: Gov.uk website. Table summarising the banding levels for the banding review period (2013-17) in England and Wales https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/211292/ro_ banding_levels_2013_17.pdf. Back

187   See: Gov.uk website. Increasing the use of low carbon technologies. Feed-in Tariffs scheme https://www.gov.uk/government/policies/increasing-the-use-of-low-carbon-technologies/supporting-pages/ feed-in-tariffs-scheme accessed November 2013. Back

188   See: Gov.uk website. Increasing the use of low carbon technologies. Renewable Heat Incentive https://www.gov.uk/government/policies/increasing-the-use-of-low-carbon-technologies/supporting-pages/ renewable-heat-incentive-rhi. Back

189   See: Gov.uk website Renewable Transport Fuels Obligation https://www.gov.uk/renewable-transport-fuels-obligation. Back

190   INEOS Bio. Back

191   This issue was alluded to in the opening section of this chapter; here it is elaborated upon. Back

192   Q 109. Back

193   Solvert. Back

194   Q 27. Back

195   Solvert. Back

196   CPI. Back

197   British Airways. Back

198   Energy Technologies Institute. Back

199   See: http://www.biopreferred.gov/. Back

200   IBLF. Back

201   University of York Green Chemistry Centre in collaboration with the regional Biovale initiative. Back

202   British Airways. Back


 
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