Is anything else wrong with efw?

Further to my previous post, the anti-incineration brigade seem to have two further arguments against efw. Firstly that it is not very green and secondly that we are heading to a catastrophic level of overcapacity and so should reign in our efforts.

Taking these in turn, I think we find that NGOs reach their conclusion on efw's environmental credentials by comparing its carbon performance with that of combined cycle gas plants. These are very efficient at generating power and when you put a heterogeneous waste fuel through a steam cycle plant it inevitably converts energy at lower efficiencies. This, they claim, means that gas fired power is preferable to efw (and of course other forms of renewables are preferable to both).

This however fails to take account of wider waste management issues. Even at the very highest recycling rates, there will still be some amount of residual waste. This can either be buried or burned. There is not much else you can do with it. In very simple terms, the carbon performance of an economy with gas fired power generation and landfill residual waste disposal will be worse than an alternative scenario with energy recovered from waste dealing with both issues simultaneously. It is simply not possible to live in a world of gas fired (or wind) power generation + zero residual waste, which is what they appear to be asking for.

The other concern seems to be that we are going to end up in a situation similar to some Northern European countries, such as the Netherlands, with overcapacity at our energy from waste facilities. Presumably NGOs worry about this as there would be an incentive to feed the efw plant rather than recycle, but I have already addressed those concerns in my previous post. The fact that RDF is being imported into those other European markets, rather than using domestic recyclate to feed their plants, may also be de facto evidence that such a scenario is unlikely to occur in reality.

If instead they are simply worrying that building too many plants would be a waste of money, then perhaps they could have a point. We currently have around 9m tonnes of residual waste treatment capacity. I think there is around a further 25m tonnes of proposals, of which around 15m tonnes has planning permission in place. (My personal view is that we could need anything from 20m-30m tonnes in total, depending on future waste arisings and recycling levels). If all of this was to be built then we would undoubtedly end up with too much residual waste infrastructure.

But is this likely? I think the short answer is no. Many of these proposals are for facilities to be developed on a merchant basis. At the moment we are seeing that even projects with a long term local authority anchor contract are struggling to raise finance. For merchant facilities it will be even harder. I have said before that finance is likely to be the principal constraint on waste infrastructure development and have not yet seen anything to change my mind.

Contrary to currently popular perceptions, banks tend to be very risk averse. Even in an easier lending climate, I think it would still be unlikely that banks would be willing to lend to a marginal project which could tip us into overcapacity (and them into loss making territory on their capital). The difference with the continental market is that the infrastructure over there is (I believe) financed and built purely by the public sector, which is also risk averse but in the opposite direction. I.e. municipalities would rather build too much than too little and are willing to pay for this. Banks are not.