Last reviewed 17 January 2017

In this article, Caroline Hand investigates how and why the trade in RDF has grown so rapidly, and looks at the somewhat contradictory forecasts and predictions which are currently in circulation.

While a possible decline in waste exports was not quite scary enough to feature in “Project Fear”, there were worries within the waste industry that Brexit could spell problems for our profitable export trade in refuse-derived fuel (RDF). In simple terms, RDF is residual, non-recyclable waste that would go to landfill in the UK but which can be burned at lower cost in continental energy-from-waste (EfW) facilities. The worry was that a weaker pound, coupled with possible new trade barriers following a “hard Brexit”, could make this export uneconomic. Our options would then be either to send the waste back down the hierarchy to landfill or invest in new recovery infrastructure here in the UK.

What is RDF?

Most of the waste collected from our homes by the local authority (LA) is taken to a Materials Recycling Facility (MRF). Here the recyclable materials are segregated out for reprocessing, leaving non-recyclable residual waste to dispose of or recover. This may be sent to landfill, transported to a local EfW facility, or alternatively it can be dried, baled and packaged up for export as RDF. The Environment Agency (EA)’s official definition of RDF is a “residual waste that is subject to a contract with an end-user for use as a fuel in an energy from waste facility. The contract must include the end-user’s technical specifications relating as a minimum to the calorific value, the moisture content, the form and quantity of the RDF”. RDF will normally contain a high proportion of organics, including plastics, as it needs to be combustible. RDF is one of the outputs from Mechanical Biological Treatment (MBT), a process used by many LAs to treat municipal waste by mechanically extracting recyclable materials and heating or digesting the residual waste to produce a fuel.

To add one more acronym, solid recovered fuel (SRF), is used to refer to a higher quality waste derived fuel which is used as a substitute for fossil fuels in cement kilns and power stations.

Why is it exported?

Although the RDF might be viewed as a renewable fuel, in the eyes of the law, it is still a waste. Its calorific value is inferior to that of fossil fuels, and it cannot be used as a direct substitute for them in the same way as SRF or fuels derived from waste oils and solvents. As a waste, it must be burned in a facility which meets the specifications for an incinerator laid down in the Industrial Emissions Directive (in the UK, this is incorporated into the Environmental Permitting Regulations).

At present, the UK does not have sufficient incineration capacity to burn all the RDF produced and without the export route, much of this residual waste would go to landfill. However, continental Europe has surplus incineration capacity and is eager to take the British RDF. This trade is different from other exports in that our waste companies have to pay the European incinerators to take the RDF, but it is still a cheaper option than sending the waste to landfill. The continental waste companies keep their gate fees below the level of the UK landfill tax to ensure an ongoing flow of waste.

Unlike the citizens of mainland Europe, the British have long been suspicious of incinerators, although fears have been allayed by the stringent controls on emissions. Only last year, LAs in Norfolk refused permission for a new EfW facility near Kings Lynn, opting instead to send the residual waste for export. Their willingness to have the waste incinerated across the North Sea laid them open to charges of hypocrisy, but no doubt economic factors played a part.

Does this benefit the environment?

Some proponents of recycling object to the export of RDF on the grounds that it might discourage materials recycling. This is basically the same argument that has been advanced for decades against the building of EfW plants in the UK.

The waste companies are at pains to point out that investment in energy recovery can go hand in hand with increased recycling since it is only the residual waste which is burned. Germany, for example, outperforms the UK in both recycling and energy recovery. There is a point at which further recycling becomes uneconomic — for example, extracting tiny fragments of plastic from mixed waste would produce a low-grade product unlikely to find a market. Reprocessors are looking for segregated, clean recyclables such as those collected separately at the kerbside.

Another argument is that by exporting RDF, we are depriving ourselves of a valuable renewable fuel which could help us to meet carbon reduction targets in the UK. This is a valid concern which is being addressed by the construction of new EfW facilities across the country. However, until this new capacity comes on stream, there is still a gap which needs to be bridged by export. The remaining worry is that the continuing availability of this profitable export route might make domestic EfW less attractive to investors.

Significantly, the European importers of RDF use it to fuel combined heat and power (CHP) plants. These produce heat for housing and industry, as well as electricity. Most UK EfW plants produce only electricity, and thus make less efficient use of the waste-derived fuel.

Finally, many people instinctively feel that it must be environmentally damaging to transport large quantities of waste to countries as remote as Poland and Norway. Surprisingly, though, the carbon emissions associated with transport are dwarfed by the carbon savings achieved through recovering this waste rather than sending it to landfill.

How has the trade grown?

The EA estimates that over three million tonnes of RDF were exported from England in 2016. This represents more than 10% of England’s total municipal waste. The trade has grown dramatically since 2010 when the Agency first issued a permit to Shanks to export 40,000t of RDF to the Netherlands. The Dutch are our biggest customers, followed by the Germans and Scandinavians. Six major waste companies — led by SUEZ/SITA UK and Biffa — are responsible for most of the trade.

The most recent statistics (for 2016) show continuing growth, but it is thought that there is now something of a levelling off.

So what of the future?

A weaker pound makes the European gate fees more expensive to British exporters and could favour the construction of more domestic EfW capacity. Waste industry experts do not agree as to whether or not future incineration capacity is likely to balance demand — while leading consultancy Eunomia predicts over-capacity, Biffa is unconvinced that all the planned facilities will materialise and foresees an ongoing need for exports. Another possibility is that, now the landfill tax escalator no longer operates, the price of landfill will fall relative to incineration, making RDF export less economic.

On the other hand, as European countries seek to increase their recycling rates in order to achieve the new EU targets, the EfW plants could find themselves with even more surplus capacity and thus might lower their gate fees to maintain the flow of British RDF.

At this stage, no-one really knows what the outcome will be. Michael Berrington, a waste industry expert, cited in the CIWM Journal last year, concluded that “those entities looking to procure medium term RDF disposal contracts will be entering into a market which is significantly more uncertain, and likely to be more challenging, than the growth markets of recent years. It will be difficult for end suppliers to provide price certainty in the long term and the proliferation of disposal routes is certain to diminish. It may well be that the RDF will have to travel further with the likelihood that the Baltic states and Polish markets play a greater role given they are likely to have the available capacity”.

It will be interesting to revisit this topic post-Brexit and discover whether the export of RDF still plays such a key role in allowing British businesses to achieve their target of zero waste to landfill.