Advice on Recycling and resource recovery infrastructure

April 2020 About us

Infrastructure Victoria is an independent advisory body with three functions:

\ preparing a 30-year infrastructure strategy for Victoria, which is refreshed every three to five years

\ providing written advice to government on specific infrastructure matters

\ publishing original research on infrastructure- related issues.

Infrastructure Victoria also supports the development of sectoral infrastructure plans by government departments and agencies.

The aim of Infrastructure Victoria is to take a long-term, evidence-based view of infrastructure planning and raise the level of community debate about infrastructure provision.

Infrastructure Victoria does not directly oversee or fund infrastructure projects.

Aboriginal acknowledgment

Infrastructure Victoria acknowledges the traditional owners of country in Victoria and pays respect to their elders past and present, as well as elders of other Aboriginal communities. We recognise that the state’s infrastructure is built on land that has been managed by Aboriginal people for millennia. Contents

Executive summary 04 Infrastructure is unevenly spread 67 Waste transport 68

Recycling and resource Future infrastructure provision 68 recovery – by the numbers 06 Not investing can be expensive 70

Supplements to infrastructure investment 72 Terms of reference 08 Market failures are stopping the sector from performing at its best 75

Recycling and resource Sorting MSW 76 recovery infrastructure outcomes 10 Procurement of waste services 78

Funding of waste processing services 79 Recommendations 13 Governance and policy settings in the sector are not quite right 80

What we found 42 The role of local governments Improved waste avoidance, recycling and the WRRGs 82 and resource recovery are key in a Data collection and reporting 83 circular economy 44 The end markets for materials vary greatly 84 Waste generation in Victoria, Markets are important 85 now and into the future 45 Market development approaches 86 There are six key materials for the sector to manage 47

Plastics 50 What we heard from

Glass 52 our stakeholders 87

Organics 54 Methodology 91 Paper and cardboard 56 Appendix A Tyres 58 Resource recovery infrastructure E-waste 60 forecast investment – 2039 94

Residual waste 62 Appendix B Defined terms 100 More resources, less waste 64 Sources 102 Recycling can create more jobs than disposal 65 List of figures 103 03 Executive summary

Advice on recycling and resource recovery Victoria’s recycling and resource We make 13 recommendations to the Victoria: A new economy provides recovery sector is under increasing Government on infrastructure, supporting the overarching policy framework and pressure. The amount of waste actions and governance, all of which have long-term focus the sector needs if it being generated is growing while been tested against a set of outcomes is to meet Victoria’s growing recycling our resource recovery rates have developed with stakeholder input. Our work and resource recovery needs. stagnated. Simultaneously, changes shows there is not one single approach in international markets, combined to achieve these outcomes. All levels of Our advice focuses on six priority materials: with weak end markets in Victoria, government, business and households \ plastics have led to large amounts of recyclables will need to work together if we are to \ paper and cardboard being stockpiled or sent to landfill. realise the huge opportunity before us. \ glass Infrastructure Victoria In April 2019, the Victorian Government We estimate about $1.21 billion worth \ organics asked Infrastructure Victoria to help address of resources was recovered in Victoria \ tyres these issues and provide advice on the in 2018/19. While highly dependent on infrastructure required, and the role for commodity prices, this figure demonstrates \ e-waste. government, to improve recycling and the potential that higher rates of resource This is because some materials we resource recovery in Victoria. recovery could deliver to the state every dispose of and recover are more year, particularly if these materials are problematic, or present greater Our advice builds on the considerable processed and used in Victoria. work underway across the Victorian opportunities than others. Our evidence Government and supports the state’s Victorians are passionate about recycling shows that improving recycling of these move to a circular economy, where we but some have lost confidence in the six materials has the potential to deliver all minimise waste and make the most system, with around a quarter of people the greatest benefit to Victoria. of resources. Shifting to a more circular we polled thinking the contents of their The infrastructure we have identified in this economy will grow the economy, recycling bins ends up in landfill. However, report supports improved resource recovery increase jobs and reduce impacts the community also has a high level of for priority materials and enables more to on the environment. willingness to help improve recycling be reprocessed and re-used in Victoria. outcomes, with 92% of people saying they We have identified 87 potential new or In this report, we have identified Victoria’s are willing to change the way they sort their upgraded facilities – 52 in regional Victoria specific infrastructure needs in the sector. rubbish. This indicates a strong desire from – to ensure Victoria has the capacity and We have also developed the most the community to do the right thing and an capability to meet our needs, now and into comprehensive and up-to-date data opportunity to rebuild trust in the system. of current and projected waste generation the future. While this will require significant in Victoria and infrastructure capacity and The Victorian Government is already initial investment from both government capability. The data and methodology working hard to address these challenges. and business, it should be viewed in the developed for this report can support It has provided funding of $135 million since context of value that can be captured infrastructure investment and network 2015 for waste and resource recovery from increasing resource recovery on management across Victoria. initiatives. The recently released Recycling an ongoing basis. 04 We have identified 87 potential new or upgraded facilities – 52 in regional Victoria – to ensure Victoria has the capacity and capability to meet our needs, now and into the future.

Expanded infrastructure is just part of funding to identify and test new uses Recycling Victoria policy. The Victorian Introduction the solution. High-performing jurisdictions, for recovered materials can create new Government has several additional like Wales, Germany, South Korea and markets. As Recycling Victoria recognises, funding streams available to support the South Australia, have used a mix of policy, Government can demonstrate its necessary transition through annual budget regulatory and financial interventions. commitment to greater recycling and allocations, the Sustainability Fund and Infrastructure Victoria These include targets, taxes, incentives resource recovery by buying products other economic development programs. and investments over the long term to made from recovered materials. achieve their current high levels of resource The Australian Government also has recovery. This is a clear lesson for Victoria The Victorian Government can further a role to play by supporting transitional about what can be achieved with the demonstrate its leadership in the recycling infrastructure investments and through right mix of policies. and resource recovery sector by reviewing encouraging producers to take greater and updating its own governance responsibility for the products they create Improving the quality of the materials going arrangements. Implementation of when they reach their end-of-life. Extended into the recycling and resource recovery Recycling Victoria will be an opportunity Producer Responsibility schemes are in system is another key focus as it impacts to provide greater clarity of the roles use internationally and are particularly the quality of the materials produced, and responsibilities of different agencies. effective in managing hard-to-recycle and the cost of processing these materials. This can make it easier for other players products and reducing problematic At the same time, it is important to ensure to navigate the sector and empower materials. that there is enough demand for these local governments in their delivery of resources to meet supply. waste services. Also, a clearer position Our advice represents 12 months of on the role of waste-to-energy, to reduce evidence gathering and development, Making it easier for Victorians to recycle the amount of waste going to landfill as as well as significant stakeholder and correctly is one of the keys to cleaner the state transitions toward a more circular community engagement. With the materials streams. economy, could encourage greater right settings in place, investment in investment in this technology. These infrastructure for collections, processing We recommend a clear and consistent efforts can be further supported by and energy recovery, we can not only approach to kerbside collections across improving the collection and sharing meet the growing need for resource the state, supported by greater separation of quality performance data to support recovery but also support our long-term of materials – including organics, glass, ongoing policy development and measure transition to a circular economy and better paper and cardboard. This should be progress. Consistent with other high outcomes for all Victorians. accompanied by an ongoing behaviour performers around the world, we support change campaign to ensure Victorians the introduction of targets to drive understand what they need to do and are performance. assured that their efforts are not wasted. Funding for these initiatives will come The Victorian Government can play from both Government and the private an active role in stimulating demand sector. The Victorian Government has and supporting markets for recovered committed $300 million to deliver the resources. Research and development 05 02.

Recycling and resource recovery Advice on recycling and resource recovery by the numbers Infrastructure Victoria

06 Six priority materials

Plastics Paper and Glass Organics Tyres E-waste cardboard

Now

$ $1.2 69% billion

Total annual value of potential 69% current recovery rate resource recovery in 2018/19

– $1.2 billion Recycling and resource recovery – by the numbers

In the future

93% 89% 3.1 million tonnes

93% of Victorian households feel it is 3.1 million tonnes of processing important to reduce non-recovered capacity required waste, and 89% are open to changing Infrastructure Victoria how their household sorts waste

$1 billion x 87 facilities

Approximately $1 billion 87 new or upgraded facilities, investment required by 2039 52 in regional Victoria

5,000+ jobs

Over 5,000 jobs could be created by Around 1.46 million tonnes of organic 2039 if 90% recovery rate is achieved waste will be generated in 2039. The food organics/garden organics recovery rate is currently 20% – almost all of this is recoverable 07 03.

Terms of reference Advice on recycling and resource recovery

In April 2019 the Special Minister of State requested Infrastructure Victoria provide advice on the infrastructure required and the role of government to improve the

Infrastructure Victoria performance of Victoria’s recycling and resource recovery sector.

08 The Government requested advice The advice was requested on the infrastructure required and the in two parts: role of Government to: 01. \ Develop Victoria’s reprocessing sector An interim report, within six months for recycled material, particularly those of the request, setting out key early Terms of reference that currently rely heavily on overseas findings, significant risks or opportunities, markets, such as plastics. and the proposed strategic direction \ Enable the use of products containing of the final advice. The interim report recycled materials in a variety was published in October 2019. of Victorian industries, such as manufacturing, construction 02. Infrastructure Victoria and agriculture. A final report, supported by evidence and analysis, detailing potential infrastructure \ Support a waste-to-energy sector requirements for the recycling and resource that prioritises the extraction of recyclable recovery sector. The final advice will also material and recovers energy only consider the regulatory, policy and market from residual waste. settings that underpin the recycling and \ Support high levels of resource recovery resource recovery sector and identify for organics, particularly food organics. potential timing of infrastructure delivery.

Infrastructure Victoria was asked to The full terms of reference are on undertake comprehensive engagement with our website. industry, the community, government, local A note on methodology government and other key stakeholders, draw on international comparisons and To inform our advice, we commissioned research, and develop its own modelling and undertook detailed technical analysis and analysis to inform the advice. across a range of subject matter areas. A summary of our approach to this work can be found in Section 8 of this report. All the analysis can be found in the full set of reports available at infrastructurevictoria.com.au

09 04.

Recycling and resource recovery infrastructure Advice on recycling and resource recovery outcomes

In recent years, the lack of an overarching policy framework and shared objectives for the Victorian recycling and resource recovery sector has been a barrier.

However, considerable work is Based on feedback from stakeholders, underway across the Victorian we have developed outcomes that Infrastructure Victoria Government to improve recycling reflect the principles of a circular and resource recovery and economy, emphasise the waste increase resilience. hierarchy and meet the requirements outlined in the terms of reference In our Evidence Base Report, we for this advice. Figure 1 illustrates proposed outcomes for the sector. these proposed outcomes. We asked for feedback so we could refine these outcomes and develop our final advice to government.

The recommendations in this report represent the key actions we think are necessary to achieve these outcomes.

10 Figure 1: Recycling and resource recovery infrastructure outcomes

Resource recovery and recycling infrastructure is connected, effective, efficient, planned, e u i protected and safe cc s es o s Recycling and resource recovery infrastructure outcomes o s oo es c s c i u e Innovation and markets for materials e Victoria has i uc s ce Governments o s sufficient o s and agencies strategically s o s o have clear e located c s roles and are c Waste management recovery and u i appropriately recycling hierarchy applied e funded infrastructure within a circular economy

Business, government, Strong demand Reuse, recovery Waste generation community for recycled and recycling is declining and and academia and reusable rates are materials streams collaborate products increasing are clean

to maximise Infrastructure Victoria resource reuse

Responsibility and costs for waste, recovery and recycling are distributed appropriately

High quality public data, Effective policy and regulation, targets and Product standards and proactive progress specifications enable licensing and reporting recycling and inspire compliance product confidence

11 Summary of recommendations

Recommendation Supports Supports Supports waste-to- Supports a circular reprocessing energy within the recovery of economy in Victoria waste hierarchy organics

Advice on recycling and resource recovery Improve infrastructure capacity and capability for recovering and reprocessing priority materials

Increase the diversion of organic waste from landfills

Provide clarity to the waste-to-energy sector & establish regulatory settings to achieve desired waste-to-energy outcomes

Review funding mechanisms to increase

Infrastructure Victoria infrastructure capacity and capability

Provide ongoing statewide and locally tailored behaviour change programs

Reduce contamination in materials streams

Introduce waste minimisation initiatives

Remove barriers and strengthen markets for priority materials

Ensure that producers and consumers involved in making and using products share the responsibility for their fate

Provide greater clarity of roles and responsibilities of Victorian Government bodies involved in recycling and resource recovery

Improve the quality and use of data to support resource recovery

Use targets to drive performance

Strengthen the status of and processes around the Victorian 12 Recycling Infrastructure Plan (VRIP) 05.

Recommendations

Infrastructure Victoria makes the following recommendations to the Victorian Government:

13 Recommendation 01 Improve infrastructure capacity and capability for recovering and reprocessing priority materials

Context

Advice on recycling and resource recovery The amount of waste Victorians generate is forecast to grow. Victoria needs investment to increase resource recovery and recycling infrastructure capacity.

This investment also needs to address Appendix A includes a summary the capability to meet market demand, of additional infrastructure capacity international import restrictions, and and capability requirements by 2039, a range of Victorian and Australian and indicative costs. Government policies, such as the Council of Australian Governments While much of the recovery and reprocessing infrastructure in Victoria

Infrastructure Victoria (COAG) waste export ban. Bans will cause significant infrastructure capacity is owned, operated and funded and capability shortfalls for paper by the private sector, the Victorian and cardboard in 2024, followed by Government has a role to play in a shortfall for plastics in 2025 unless facilitating investment, leveraging further investment is made. existing investment and providing direct funding to the sector where Similarly, Victoria’s capacity and the market fails to do so. capability to manage recovered organics and e-waste will be exceeded The data used to inform these by 2025 and 2030 respectively, as recommendations are based on a result of policies such as the National modelling that provides projections Waste Policy and Victoria’s e-waste to inform Victorian Government landfill ban, introduced in 2019. decision making. The projections should be considered approximations rather than precise predictions.

14 Priority materials are paper and cardboard, plastics, glass, organics, e-waste and tyres.

Recommendation

Key infrastructure requirements Glass – Anaerobic digestion capacity in Recommendation 01 for each priority material are Metropolitan Melbourne to process outlined below. \ Additional glass beneficiation (removing metropolitan food organics, and in contaminants, sorting by colour and regional Victoria, co-located with Paper and cardboard maintaining a minimum piece size) existing wastewater treatment plants capacity and capability in metropolitan and food production hubs that generate \ 600,000 tonnes of additional paper Melbourne to achieve higher value glass significant volumes of food waste. Infrastructure Victoria sorting and pulping infrastructure from use where possible (e.g. for recycled 2024. glass containers instead of glass sand). \ Hardstand infrastructure in regional agricultural areas to encourage \ Additional capacity and capability to \ Glass sand reprocessing in regional maturation and tailored blending of manufacture paper and cardboard areas to enable more use of recycled compost for specific applications. packaging products, such as tissue, glass sand in regional road construction. paper towels and egg cartons. E-waste Organics \ Improved mechanical sorting of mixed \ 4,300 tonnes of mechanical paper and cardboard at Materials \ Additional dedicated organics recovery reprocessing infrastructure capability Recovery Facilities (MRFs) to recover transfer stations in the outer northern to enable high-value e-waste materials different paper grades, enhancing and western growth corridors (in line to be recovered across metropolitan access to paper reprocessing markets. with the Statewide Waste and Resource Melbourne and regional Victoria by 2030. Recovery Infrastructure Plan’s hubs Plastics of state importance) to aggregate \ Support ongoing research into and consolidate increasing amounts new technologies to manage hard \ 288,600 tonnes of total capacity of food and garden organics (FOGO) to recover and hazardous e-waste. and capability to produce plastic from metropolitan Melbourne. Emerging techniques to consider flakes and pellets by polymer in include improved mechanical and metropolitan Melbourne and regional \ Additional capacity of 130,000 tonnes optical, thermal, chemical, nano Victoria from 2025. by 2025 and 555,000 tonnes by 2039, and biological processing. through a combination of: \ Transition from recovering mixed \ Consider improvements to the existing plastics bales to recovering plastics – Open windrow composting capacity e-waste disposal network focussed separated by polymer using improved in regional Victoria, particularly Barwon at resource recovery centres, with optical sorting. This will enable MRF South West and Grampians Central increased drop-off points where operators to sell to export markets West by 2025. electronic goods are purchased. or domestic reprocessors. This may require appropriate cost- – In-vessel composting capacity sharing in line with product stewardship \ Upgrade Victorian resins manufacturing in metropolitan Melbourne and approaches and compliance with infrastructure to incorporate recycled throughout regional Victoria. plastics into new plastic products. waste handling requirements. 15 Advice on recycling and resource recovery Key findings \ Continue to collaborate with the Other materials Australian Government to develop a product stewardship approach \ Develop MRF (Materials Recovery for end-of-life solar photovoltaic panels, Facility) input and output quality vehicle and household batteries. standards that complement Victorian and local government efforts to reform \ There is an immediate need to plan Tyres kerbside recycling. for investment in paper and cardboard reprocessing infrastructure in Victoria \ Investigate opportunities to use \ Assess the viability of establishing to comply with the COAG Waste passenger vehicle tyres in the production small to medium-sized MRF infrastructure Export Ban. of crumb rubber for road construction. in regional Victoria for better recovery

Infrastructure Victoria of recyclables starting with Grampians \ To make up a large proportion of the \ Increase fibre separation infrastructure Central West and Barwon South West shortfall, and to continue Australian in metropolitan Melbourne to assist the Waste and Resource Recovery Group exports, investment in large-scale domestic reuse of passenger tyres or as (WRRG) regions. paper sorting and pulping facilities a contingency for international market is required in Victoria. Alternative constriction. Separated fibre will need \ Optimise Victoria’s extensive Resource processing will also need to increase to go to waste-to-energy solutions, such Recovery Centre and Transfer Station or be developed. Alternate processing as process engineered fuel, or require network to improve regional resource can include: additional support to develop a recovery and, where necessary, – moulded fibre production market for it. consolidate sites for better resourcing – insulation and more efficient transport. – kitty litter – composting.

\ Victoria does not have the capability to sort mixed plastics at MRFs. With no market outlet for mixed plastics, this material is either being stockpiled or landfilled. This prevents Victoria from maximising existing industry reprocessing capacity.

\ Victoria has an estimated glass processing capacity of around 494,200 tonnes. This is enough to meet requirements of the COAG ban and Victorian policies.

16 Recommendation 01

\ While we expect there will be enough that reduces weight and volume \ There is sufficient tyre reprocessing capacity to process the amount of followed by transport to regional areas capacity to meet the requirements

glass generated in future, there may for additional processing and use. of the COAG export ban and Victorian Infrastructure Victoria be opportunities in regional areas policies. There are no immediate for processing glass into glass sand, \ E-waste generation is increasing investment opportunities in regional aggregates and other products. There in Victoria due to rapid product areas, with the largest output – is also an opportunity to increase the innovation, the falling cost of new shredded tyres – almost entirely percentage of recycled glass currently products, and consumer desire exported overseas. However, there used in glass packaging production to upgrade. Following the 2019 is an opportunity to increase the use in Melbourne. introduction of a Victorian e-waste of recovered passenger vehicle tyres, landfill ban, there are now pathways along with their commodity value, \ Without further investment in organics for collection, with waste facilities in by improving Victoria’s infrastructure processing capacity, increasing Victoria providing a separate bin for capability. This provides important collection of FOGO will lead to a e-waste and other disposal points at contingency planning for these shortfall in Victorian infrastructure various council and private facilities. materials if market conditions change. capacity and capability to reprocess Drop-off facilities at retail sites have these materials. proved successful for other e-waste \ Victoria relies on a relatively small collections, such as Mobile Muster number of MRFs for Municipal Solid \ Melbourne’s processing capacity for mobile phones. Waste (MSW) processing, which for organics is significantly less than makes the sector less resilient and what is recovered; Melbourne relies \ There are some emerging e-waste creates problems if one player exits on regional and interstate processing. products of concern, specifically solar the industry. In addition, the location Access to suitable sites that can meet photovoltaic panels and batteries of resource recovery and reprocessing regulatory requirements is likely to for solar systems and electric vehicles. infrastructure is determined by restrict opportunities to add processing Growing amounts of these will reach the private sector, so it does not capacity in Melbourne. There is the end of their useful life in coming necessarily minimise transport costs an immediate need to invest in years. There is a lack of proven for local government. Market dynamics Victoria’s organics consolidation technological reprocessing solutions can also affect the way infrastructure and reprocessing infrastructure to that can be deployed at scale. is used – where it may be to one meet current and future generation Infrastructure Victoria raised this issue player’s advantage to slow production and recovery rates. A more practical in its Advice on Automated and Zero in certain circumstances. solution is to aggregate and consolidate Emissions Vehicles Infrastructure in organic material, with initial processing 2018 (Recommendation 15). 17 Recommendation 02 Increase the diversion of organic waste from landfills

Context

Advice on recycling and resource recovery Organic material is one of the largest waste streams in Victoria, estimated to make up around 35% of household garbage bins. There is also a large amount of organic waste from the commercial and industrial sector but the data in this sector is not comprehensive. Given that almost all of this material can be recycled in some way, this represents a significant opportunity.

Recommendation Infrastructure Victoria

Beyond the infrastructure capacity \ Conduct targeted organics research, and capability recommendations already development and demonstration activities identified for organics, Infrastructure to promote recovered organics as Victoria also recommends that the an alternative to soil conditioners Victorian Government: in agricultural production.

\ Support Victorian councils to increase \ Develop product standards and FOGO kerbside collection services agricultural industry guidance to for greater recovery of food waste support the use of recycled organics and reduced contamination in the products in agriculture and provide organic material stream, as mentioned information to increase confidence in the Recycling Victoria policy. in their use.

\ Complement FOGO collection services \ Investigate the merits of a Hazard with community behaviour change Analysis and Critical Control Point programs to ensure organics collections (HACCP) regulatory framework for are well-promoted and utilised. These anerobic digestion. programs should prioritise food waste reduction and align with the Love \ Collaborate with the Australian Food Hate Waste campaign (see Government to clarify the application Recommendation 5). of the Australian Carbon Credit Unit (ACCU) system to waste-to-energy \ Increase Commercial and Industrial systems, including anaerobic digestion. (C&I) food organics recovery rates, starting with hospitality and food \ Consider landfill bans or other incentives manufacturing businesses. if landfill diversion rates plateau. 18 Key findings

\ There is a significant opportunity a kitchen caddy and/or a kerbside \ There is a high demand for some for Victoria to divert organic bin is provided. This will depend recycled organics, such as timber waste from landfill, recover these on the residential setting (house and mulch, for use in urban areas. valuable resources and improve the or apartment and size of garden). This includes residential and

environment. Victoria’s recovery rate Ongoing collection and processing commercial landscaping. There Recommendation 02 for organics (42.3%) is significantly costs range from $8 to $50 per is less demand for recovered lower than other material streams household. food organics. Providing greater (69% on average). information about the quality and \ Only around one-third of food waste potential uses of recycled organics \ Food waste makes up 19% of generated in Victoria is estimated can increase demand. landfill, and produces methane as to come from households, with

it breaks down, which has a global the remainder coming from the \ A combination of transportation Infrastructure Victoria warming potency around 25 times C&I sector. There is limited detailed costs and gate fees can limit that of carbon dioxide.1 Emissions data around food waste generation recycled organics use in agriculture from the waste sector account for and recovery from the C&I sector in due to distance from the supply 2% of Victoria’s total emissions. Victoria, making it difficult to develop (metropolitan Melbourne). specific responses for this sector. \ Twenty-seven of Victoria’s local \ C&I food waste is generally governments offer FOGO collection \ Sustainability Victoria (SV) estimates more suitable than household and a further 31 only offer a garden that for the 447,000 tonnes of waste for use as an anaerobic organics collection. This leaves organics recovered in 2017/18, digestion feedstock.

21 local governments offering around 103,00 tonnes of CO2 no organics collection of any equivalent emissions are avoided. \ Widespread adoption of anaerobic kind – two of which are metropolitan This implies that for a 10% increase digestion in the European Union (EU) and 19 are regional. in FOGO recovery rate, the is supported by HACCP regulatory environmental benefit would be an frameworks, product certification \ The performance of FOGO systems and guidelines for safe use. These additional 10,000 tonnes of CO2 can differ greatly. The 2018 National could be avoided. measures in combination ensure Waste Report says that well- digestate is safe for agricultural use promoted, carefully designed \ Clean organic material streams can and streamline the requirements systems can capture about 70% lead to more recovered organics that apply to waste suppliers and of food waste. In some local used on the land, which has digestate users. HACCP is widely government areas less than 4% significant benefits to soil health, used for food production in Australia. of the population participate. strengthening the market for these materials. Behaviour change can \ There is uncertainty around \ A full rollout of FOGO is estimated support cleaner streams and further the application of carbon credits to cost $10-$60 per household strengthen the market. to anaerobic digestion, particularly initially, depending on whether for some proponents.

19 1 Sustainability Victoria (2018) Guide to Biological Recovery of Organics Recommendation 03 Provide clarity to the waste-to-energy sector and establish regulatory settings to achieve desired waste-to-energy outcomes

Context Recommendation

Advice on recycling and resource recovery There is a role for waste-to-energy Develop a waste-to-energy policy that reflects the waste hierarchy and to deal with residual (non- supports, rather than hinders, a transition toward a circular economy. recoverable or non-recyclable) A Victorian waste-to-energy policy should contain the following: waste in Victoria. In the waste \ Information on how waste-to-energy’s \ Encouragement for strategic site hierarchy, energy recovery is a role in Victoria supports and facilitates locations, including co-location with better outcome than disposal to the waste hierarchy. industry that can either provide feedstock landfill. Evidence suggests policy for, or use the residual energy and heat \ A government commitment to build from, waste-to-energy infrastructure. uncertainty is stifling private sector social licence for residual waste-to-energy Prioritise development either within investment in waste-to-energy and a requirement that projects involve strategic hubs identified by the Victorian Infrastructure Victoria infrastructure. The Government’s extensive community consultation, and Recycling Infrastructure Plan (VRIP) Recycling Victoria policy has provide ongoing and comprehensive or co-locate facilities with industry. information to the community. committed to development of \ Standards for residual products a waste-to-energy framework. \ Measures that prevent harm to human to facilitate market development. Clear policy is necessary to ensure health and the environment, in line with Waste-to-energy processes generate desired outcomes and mitigate existing Environment Protection Authority residual materials which, unless used (EPA) requirements and overseas against risks, such as demand elsewhere, will go to landfill. Reusing technical and regulatory experience for feedstock creating perverse these products, where possible, is from places such as the EU. Existing preferable. For example, fly and bottom incentives to generate more waste, EPA standards for emissions, noise, ash can be used for building and road and undermining improvements dust and odour will apply, but EU construction. to reuse and recycling options. standards and best practice methods should also be considered for product \ Measures to ensure landfill levies do not design, emission control, and ongoing make waste-to-energy uncompetitive and continuous monitoring. with landfill.

\ Requirements that energy recovery meet minimum energy efficiency thresholds, consistent with international practice.

\ Ways to avoid overcommitting to waste tonnages. Long-term secure feedstock contracts are necessary for waste-to- energy projects to be financially viable, which risks creating perverse incentives to increase waste. 20 Key findings Recommendation 03

\ Waste-to-energy is a preferable \ Facilities should account for the \ The amount of residual waste in the alternative to landfill if there are changing generation and composition future is uncertain. Our modelling and no other viable recovery options. of residual waste. analysis suggests that by 2038/39, Victoria should still prioritise waste Victoria will generate 650,000 tonnes reduction, reuse and recycling. \ The amount of energy generated per year of residual waste from the six from waste-to-energy should not be

A future waste-to-energy policy priority materials alone, assuming a Infrastructure Victoria should not encourage waste that overstated. The Clean Energy Finance 90% recovery rate. The business-as- could have feasibly been recycled, Corporation estimates that energy usual forecast is for up to 5.7 million reused or avoided to become from waste could meet up to 2% tonnes per year of residual waste. 3 feedstock. Waste-to-energy solutions of Australia’s electricity needs. Not all of this residual waste will higher on the waste hierarchy (for be suitable for waste-to-energy. \ Waste-to-energy by-products may example, anaerobic digestion of contain contaminants that make organic materials – see \ The need for waste-to-energy them unsuitable for recycling in some Recommendation 2) are higher to manage residual waste will be cases – particularly if facilities are used priority. highly dependent on efforts to reduce to manage hazardous wastes. Landfill waste and recycle materials, as well \ For waste-to-energy facilities to be planning should include the potential as the planned landfill capacity. The competitive, the landfill levy needs need to manage these materials. Recycling Victoria policy’s stated to be set to an appropriate level.2 capacity cap of one million tonnes \ The Queensland Government found Government has a role to play in per year for waste-to-energy should that pre-sorting residual waste to ensuring that regulations and market be regularly reviewed to manage these extract recoverable materials prior prices support options that are higher uncertainties. If combined efforts to to energy recovery imposes additional on the waste hierarchy. The private reduce waste generation and recycle costs for energy recovery facilities sector is responsible for making material are not highly successful then and recovers lower quality recyclable financially viable business models there is a risk that significant amounts materials.4 for waste-to-energy facilities, but of residual waste above the one government can support the pursuit million tonne waste-to-energy cap of waste-to-energy by removing will be consigned to landfill. barriers to entry.

2 Department of Environment, Land, Water and Planning (2017) 3 Clean Energy Finance Corporation (2016) Energy from 4 Office of Resource Recovery, Department of Environment and Turning waste into energy, Join the discussion waste in Australia: a state-by-state update Science (2019) Energy from Waste Policy – Discussion paper for consultation 21 Recommendation 04 Review funding mechanisms to increase infrastructure capacity and capability

Context Recommendation

Advice on recycling and resource recovery Typically, grants of up to The Victorian Government and $500,000 have been given by responsible agencies should review Sustainability Victoria to increase the effectiveness of existing funding mechanisms such as grants, tenders and the quantity of recycled products collaborative procurement and trial the sold, increase resource recovery, use of auctions to secure reprocessing divert waste from landfill, fund infrastructure capacity, as identified in infrastructure projects, develop Recommendation 1, in the following way: new markets, and fund research \ A field pilot to test implementation and development. Through and cost-effectiveness of auctions. Infrastructure Victoria the new Recycling Victoria Infrastructure Fund, grants of \ Separate auctions for each waste processing class because the cost up to $8 million are now available of additional waste processing will for some materials. In addition, vary for different types of waste other arms of government may (i.e. glass, plastics etc.). provide grants and other \ An auction in which bidders submit investment assistance. bids as in a tender. However, rather Although grants can have some than submitting one proposal, each competitive elements, they are essentially bidder would be allowed to submit a a negotiation between government and bid schedule to indicate the quantity industry. In negotiations, a well-informed of additional waste processing effort supplier will often benefit over a less- they would offer over a range of prices. informed buyer. Firms and organisations \ An assessment of the effectiveness know their costs of production and of the field pilot compared to other Governments often do not. funding approaches.

22 Key findings Recommendation 04

\ Grants may not always lead to the \ The Victorian Government (and other best outcomes or value for money for governments throughout Australia and government. In recent years, resource around the world) already use a range recovery grants have been capped at of other financial support approaches a maximum of $500,000 which may to deliver policy outcomes, such as

not be enough to achieve significant rebates, subsidies and low-interest Infrastructure Victoria increases in resource recovery and loans which could also be applied recycling rates. to resource recovery.

\ There is significant potential to increase \ An auction creates a competitive the coordination across government of environment in which the supply various investment initiatives to improve schedule is expanded by asking resource recovery. bidders to nominate the amount of additional effort they would be \ Auctions can reveal information needed willing to supply at different prices. to efficiently allocate resources by Competition forces bidders to seek harnessing competition between compensation only for the difference competitors as a means of identifying between the cost of supplying who wins and at what price. Well- additional effort and returns for selling designed auctions have been shown to the waste material processed.5 achieve a given outcome at lower price compared with a grant mechanism.

\ Auctions are an alternative approach used successfully in Victoria to achieve government objectives related to infrastructure and efficiently allocate resources, including for the allocation of aquaculture sites in Victoria and to allocate mobile phone spectrum.

5 Centre for Market Design (2019) Opportunities to improve infrastructure investment in the Victorian waste economy, report for Infrastructure Victoria 23 Recommendation 05 Provide ongoing statewide and locally tailored behaviour change programs

Context Recommendation

Advice on recycling and resource recovery Overall, people are willing The Victorian Government should \ Considers the role of both positive to change the way they sort ensure its investment in household and punitive incentives and other interventions over the medium to their waste. Our community and business behaviour change programs is consistent and ongoing. long term. research shows that nearly 90% The key objectives of the Recycling of Victorians are open to it. Victoria policy’s behaviour change \ Prioritises specific actions and solutions programs should include: for households that build on existing The Victorian Government should harness good intentions and understanding. this willingness and partner with local \ waste minimisation government and industry to make it easier \ Monitored and evaluated. for households to minimise and better \ contamination reduction

Infrastructure Victoria \ Integrated with relevant initiatives sort their waste. Greater separation of \ buying more recycled, reusable, and like the APCO targets and Australasian waste in homes and businesses can recyclable or compostable products. Recycling Label. reduce contamination and improve the quality of recycling. Promoting behaviour At a minimum, a behaviour change \ Draws from consumer behaviour change is critical to achieving this. program should be designed using research. the following principles: \ Supported by easy-to-use source- \ Centrally managed and funded. separation infrastructure at the point of disposal (see Recommendation 6). \ Consistent messaging across Victoria, with nuance for local areas as needed.

\ Persistent and ongoing, evolving as performance improves.

\ Tailored to meet the needs of specific audiences e.g. culturally and linguistically distinct or diverse communities, residents of multi-unit developments, hospitality businesses etc.

24 Key findings Recommendation 05

\ Victorians already understand \ There is limited coordination easy and consistent as possible. the need to recycle, so behaviour and sharing of materials between Eliminating or reducing barriers to

change efforts should harness the Sustainability Victoria, the Metropolitan better recycling behaviour is key Infrastructure Victoria enthusiasm and goodwill of the Waste and Resource Recovery Group to behaviour change. Programs community to do even better. and local governments, which all need to be supported by a more We surveyed 1,000 Victorians provide waste education.7 We have consistent approach across Victoria. to understand their attitudes and heard from industry stakeholders perceptions about how they sort that there is also limited information \ Examples of successful programs their waste at home, and their sharing between industry and include the TAC Towards Zero and willingness to change their behaviour. government. the Target 155 campaigns. Both We found that most Victorians feel have a long-term focus, consistent it is important to reduce landfill \ Waste education in Victoria does not messaging and ongoing funding. waste (93%), and they consistently often prioritise waste avoidance but While it is difficult to determine the recycle when provided with a usually focuses on what to do with contribution of the Towards Zero kerbside recycling bin (85%). waste after it is generated. Avoidance campaign to changes in Victoria’s education is generally only provided road toll as opposed to changes \ There is significant room for in short bursts and under-funded in technology, the number of lives improvement in individual recycling relative to other government lost on Victorian roads has declined practices. We looked at why this is campaigns, limiting its reach, impact significantly since the campaign and discussed what the community and ability to effectively change began, even as the number of drivers would like to see and hear to help behaviour.8 on Victorian roads has increased. them recycle more effectively. Key points include simplicity (separate \ Behaviour change programs will bins for different materials), be most effective in changing consistency and a strong recycling outcomes where correct understanding of the benefits.6 recycling is already as simple,

6 Quantum Market Research (2019) Kerbside Collection Deep 7 Victorian Auditor-General’s Office (2019) Recovering and 8 ibid. Dive, report for Infrastructure Victoria Reprocessing Resources from Waste 25 Recommendation 06 Reduce contamination in material streams

Context Recommendation

Advice on recycling and resource recovery Contamination occurs when an To reduce contamination of item is disposed of in the wrong materials streams, Infrastructure bin. Contamination reduces the Victoria recommends that the Victorian Government: value of recyclable materials because either additional sorting \ Require and support all local is needed to remove unwanted governments to standardise bins materials, which can be costly, for household collections, consistent with the Government’s commitment or the processor needs to dispose in the Recycling Victoria policy to of these materials to landfill, standardise bins and kerbside services. Infrastructure Victoria which is also costly. \ Advocate for and support the review This lowers the market value of materials of the Australian Standard for mobile which lowers the incentive to invest in waste containers AS4123.7. reprocessing and recycling infrastructure. In some cases, these costs make recycling \ Establish a minimum service standard more expensive than using virgin materials. for local government waste services to promote greater consistency An important element in reducing in collections across Victoria. contamination is improving source separation and consistency in the way \ Promote greater source separation waste is collected – particularly for of MSW by encouraging and supporting household waste. Not all councils accept the rollout of separate kerbside bins the same materials in recycling collections, for glass, or paper and cardboard. due to differences in what processors \ Drive greater consistency in the materials will accept. At the same time, bin lids collected within each service (e.g. FOGO differ in colour and meaning across and commingled) across Victoria. local government areas. \ Evaluate existing models to design These differences can lead to confusion the best Container Deposit Scheme for households and contamination of for Victoria. material streams, and create a barrier to efficiently and effectively educating the community on what they can recycle.

26 An important element in reducing contamination is improving source separation and consistency in the way waste is collected.

Key findings Recommendation 06

\ Infrastructure Victoria’s community \ There is limited detailed data on \ The Victorian Parliamentary Budget polling suggests that 25% of all contamination rates in the C&I Office (PBO) costed a CDS for the

respondents who have commingled sector in Victoria making it difficult Victorian Parliamentary Inquiry into Infrastructure Victoria kerbside collection are unsure of to develop specific responses for recycling and waste management which bin things should go in.9 this sector. and found that a CDS would deliver a financial benefit to Victoria of \ Countries that have high rates of \ Container Deposit Schemes are $244.5 million from 2019-20 to resource recovery from MSW tend in place across Australia. Results 2022-23. This reflects an increase to have a more consistent approach in each state or country vary in government revenue of $253.5 to sorting and collection. Currently, depending on the exact model million due to uncollected deposits approaches differ across Victoria’s used. Our consultation indicates from containers not being returned, 79 local councils. that Queensland (active scheme) partially offset by an increase in and Western Australia (scheme operating expenses of $9.0 million \ Standardising bins is estimated to in design phase) are leading to manage the scheme. cost between $22-$60 per household examples to investigate further. depending on whether the entire bin \ Commingling of glass with paper is replaced, or just the lid. \ One of the key benefits of CDS is and cardboard leads to lower that they can reduce contamination. recyclability of these materials \ A consistent approach to collections Cleaner materials streams can from household collections. This is estimated to cost between increase the potential for their re-use. is because the glass gets broken $35-$60 per household for an and becomes embedded in the additional bin and $3 per collection. \ The introduction of a CDS was paper and cardboard. Separating commonly identified by stakeholders these materials is therefore key to \ In 2017/18, contamination rates in who provided feedback on our improved recycling. Depending on Victorian MSW ranged from 3% Evidence Base Report as an initiative the proximity of paper or glass to 27%, with an average of 10.4% that could improve Victoria’s waste 10 reprocessing, it may be more across all local government areas and resource recovery system. depending on the effort put into appropriate to prioritise one or education and enforcement \ 92% of people we polled favoured the other in some regional areas. along with the socio-economic the introduction of a CDS. characteristics of the area.

27

9 Quantum Market Research (2019) Waste Advice Research, 10 Sustainability Victoria (2019) Victorian Local Government report for Infrastructure Victoria Annual Waste Services Report 2017-18 Recommendation 07 Introduce waste minimisation initiatives

Context Recommendation

Advice on recycling and resource recovery In line with the waste hierarchy, The Victorian Government should: waste minimisation or avoidance \ Provide support and funding to household is the best way to manage waste. food waste minimisation initiatives (such as Sustainability Victoria’s Love Food, Hate Minimising waste will not only ease Waste), to target avoidable MSW food pressure on Victoria’s recycling and waste which currently accounts for resource recovery infrastructure, it a third of Victoria’s household garbage will also reduce pressure on Victoria’s stream by weight. Ensure that the finite natural resources and reduce the statewide municipal recycling behaviour environmental and human health impacts change campaign emphasises the

Infrastructure Victoria of waste, such as polluted waterways. importance of waste avoidance Waste minimisation is also one of the key (see Recommendation 5). objectives of the Recycling Victoria policy. \ Consider levies or bans on specific materials that are difficult to recycle or contribute to environmental problems, Minimising waste will not only if viable alternatives exist.

ease pressure on Victoria’s \ Work with the Australian Government recycling and resource and industry to evaluate EU regulations underlying the Waste, Electrical and recovery infrastructure, it Electronic Equipment Directive (WEEE) will also reduce pressure for potential adoption. These regulations include longer warranties for the products, on Victoria’s finite natural requiring spare parts to be guaranteed, resources and reduce the and mandating manufacturer repair to support the development of repair culture. environmental and human health impacts of waste.

28 Key findings Recommendation 07

\ The amount of waste we generate \ Food waste accounts for a third has been growing. This is due partly of Victoria’s MSW garbage stream to population growth and partly to by weight. Nearly two-thirds of this changes in our economy and society, is avoidable food waste (such as such as increased consumption bakery items, meals, dairy, eggs,

and packaging. fresh vegetables and fresh fruit). Infrastructure Victoria Victorians estimate that they waste \ The most cost-effective way to manage around $39 worth of food and drink waste is to create less in the first place. a week – $2000 a year. Across The waste hierarchy calls for waste Victoria, this adds up to about $4 avoidance and minimisation, including billion a year. better product and packaging design, and reusing or repairing products and \ E-waste – end-of-life electronic items. Avoiding and reducing waste products with a plug or battery – will reduce pollution, greenhouse gas is a fast-growing waste stream. E-waste emissions, and the pressure on our is a complex mixture of materials and waste management infrastructure. components that, because of their hazardous content, can cause major \ Reducing waste reduces sorting environmental and health problems if costs and contamination. not properly managed. While there are already Australian product stewardship \ Levies or bans on single-use plastic schemes for televisions, computers straws and cutlery, along with non- and mobile phones, many electronic recyclable coffee cups may help products do not have such combat Victoria’s litter problem and arrangements. An EU directive created promote behavioural change. That collection schemes where consumers said, poorly designed levies or bans return their e-waste free of charge. on some materials, such as single- These schemes aim to increase use plastics can lead to unintended e-waste recycling and/or re-use. Most consequences. Some industries rely electronics brands with an Australian on single-use plastics for medical presence are also operating in the EU or research purposes. and therefore are required to comply with these requirements in Europe.

29 Recommendation 08 Remove barriers and strengthen markets for priority materials

Context Recommendation

Advice on recycling and resource recovery Over the last decade, there has Infrastructure Victoria recommends the Victorian Government use multiple been a significant focus in Victoria approaches to develop end markets for recycled materials. The actions identified on establishing infrastructure here should be applied first to priority materials: glass, organics, plastics, paper and card, e-waste and tyres. to collect, sort and, to an extent, reprocess recovered resources. \ Support research and development \ Develop and provide recycled product However, this supply of recyclable in the use of recycled materials and information and guidance to increase materials has not always been products and conduct targeted research confidence in the use of recycled and demonstration activities for each products, such as the use of recovered matched by significant, ongoing priority material. This will overcome organics in agriculture or plastics in demand for recycled products. product-specific market challenges, packaging manufacturing. This may Infrastructure Victoria such as the application of organic include approaches such as eco-labelling, With the lack of demand, stockpiling materials to land and the use of environmental product declarations, has occurred, the commercial viability recycled plastic in packaging. standards, product specifications and of some operators has been challenged, safety data sheets. waste sector operators have at times failed \ Build on research, development to comply with regulatory requirements, and demonstration working groups \ Update the Sustainable Procurement and there have been multiple waste material with representatives from government, Objectives in the Victorian Government’s fires throughout Victoria. the recycling industry, end market Social Procurement Framework to include industries and researchers to accelerate more explicit requirements about the use To address this supply and demand the use of recycled materials. of recycled content. Prioritise sustainable imbalance, further market development outcomes in evaluating procurement is required to identify opportunities that \ Build on recent efforts to update proposals. The Victorian Government’s can use significant and reliable volumes standards and specifications more recently announced ‘Recycled First’ of recycled materials. The Victorian quickly to enable greater use of recycled program for major construction projects Government has indicated in Recycling materials and products in Victoria. is an example. Victoria – a new economy that it will play a significant role here. \ Transition to performance-based \ Collaborate with the Australian specifications in Victoria to ensure Government to investigate the recycled materials are fit-for-purpose, costs and benefits of taxes, levies particularly for use in construction and and other incentives to increase agriculture. This would prescribe the the competitiveness of recycled desired outcomes, allowing industry materials relative to virgin materials. to decide which materials (including recycled products) it will use to comply.

30 Key findings Recommendation 08

\ Research and development with the potential of recycled materials industry has been effective in the roads as either direct substitutes for virgin

and rail sectors, with the approval materials or where there are new Infrastructure Victoria of several Victorian specifications uses and benefits associated with permitting the use of recycled using them. materials. This approach could be applied to plastics manufacturing, \ The Government supports research packaging, agriculture, and paper and and development through funding cardboard manufacturing. facilitated by Sustainability Victoria. This can be scaled up and down, \ Performance-based specifications but an increase will be required to are less prescriptive when it comes move forward on all priority materials. to how materials are made, and the processing required to meet \ The UK Government recently infrastructure performance criteria implemented a tax on the production and encourage innovation. and import of non-recyclable plastic packaging from 2022. The tax was \ Where the Victorian Government a response to high levels of plastic is not responsible for authorising packaging waste, which predominantly standards and specifications, it can came from new plastics.11 It is difficult play a key role by resourcing and for the Victorian Government to facilitating working groups to increase impose a similar tax as Victoria is the use of recycled materials across just one part of a larger market and a range of industry sectors. products can flow across state borders relatively easily. \ Recycled materials have sometimes been seen as lower quality than virgin materials. Research and development activities are crucial to identifying

31 11 AlphaBeta (2019) Recycling and resource recovery infrastructure in Victoria: International and Australian comparisons, report for Infrastructure Victoria Recommendation 09 Ensure that producers and consumers involved in making and using products share the responsibility for their fate

Context Recommendation

Advice on recycling and resource recovery In many instances, producers of To provide an incentive for consumers and producers to consider the cost goods and services do not face the of disposing of or recycling materials, the Victorian Government should:

cost of waste created by packaging \ Work with the Australian Government \ Work with the Australian Government or the end-of-life fates of products. to update the Product Stewardship and industry groups to further develop Act 2011 Product List, which has not product stewardship schemes under By not considering these costs, producers been updated since 2017-18. the Product Stewardship Act 2011, may over-invest in packaging to attract assessing the merits of voluntary, buyers’ attention or manufacture goods \ Collaborate with the Australian co-regulatory or mandatory schemes. that cannot be easily repaired. Further, Government and the electronics consumers do not face all the costs of industry to increase the scope of \ Work with the Australian Government

Infrastructure Victoria their consumption, or their sorting and e-waste product stewardship covering and industry groups to consider the disposal choices. a wider range of e-waste types, where key elements of successful international justified based on the material value product stewardship schemes and and environmental risks they present. their suitability in Australia. Key elements include:

– levies and deposit refunds – take-back requirements – advance disposal or recycling fees – product labelling requirements – product design and repair requirements – recycled content targets – resource recovery rate targets.

\ Work with the Australian Government to fast-track and prioritise the development of a national product stewardship approach for photovoltaic systems in the short-term.

\ Work with the Battery Stewardship Council to include electric vehicle batteries, addressing the risks set out win Infrastructure Victoria’s Advice on Automated and Zero Emissions Vehicles Infrastructure (Recommendation 15). 32 Key findings Recommendation 09

\ Product stewardship (PS) and \ Multiple stakeholders raised the need extended producer responsibility for mandatory PS for ‘difficult to

(EPR) measures can facilitate the recycle materials’, such as packaging Infrastructure Victoria shared responsibility of manufacturers, made from multiple materials. retailers and consumers for the impact of products on the environment, public \ The Product Stewardship Act 2011 safety and human health. They aim is administered by the Australian to ensure that everyone involved in Government to provide a framework the creation and use of a product for reducing the environmental and shares the burden of what happens other impacts of products. It is to it at the end of its useful life. currently only applied to a limited number of products. Of the several \ Consumers and producers are not voluntary schemes, participation exposed to the full cost of the waste and effectiveness vary widely. they generate. This is a ‘negative externality’ that can be addressed through EPR or PS.

\ The most successful international examples of PS are underpinned by mandatory approaches.12 There are currently no mandatory Australian schemes.

12 AlphaBeta (2019) Recycling and resource recovery infrastructure in Victoria: International and Australian comparisons, report for Infrastructure Victoria

33 Recommendation 10 Provide greater clarity of roles and responsibilities for Victorian Government bodies involved in recycling and resource recovery

Context Recommendation

Advice on recycling and resource recovery There is confusion about the Infrastructure Victoria recommends responsibilities of different that the Victorian Government:

government bodies involved \ Eliminate overlap in roles and in the waste and resource recovery responsibilities of the Department of sector. This is well documented Environment, Land, Water and Planning by the Victorian Auditor-General’s (DELWP), Sustainability Victoria (SV) Office and was raised with us and the Waste and Resource Recovery Groups (WRRGs). For waste, key areas by stakeholders. to distinctly allocate are policy, strategy, VAGO found that the lack of an overarching behaviour change, waste collection, waste Infrastructure Victoria waste policy and gaps in statewide processing, infrastructure planning and guidance resulted in ad hoc and reactive contingency planning. responses from agencies instead of \ Specify the waste management strategic responses, and an inability to services roles and responsibilities plan for sufficient infrastructure. of local governments in legislation. In November 2019, the Victorian \ The roles and responsibilities of local Parliament’s Environment and Planning government should include minimum Committee Inquiry into Recycling and service standards, implemented through Waste Management also recommended subordinate instruments. Minimum service a review of governance arrangements standards could include bin lid colours to ensure clear roles, responsibilities and and the specific materials accepted. accountabilities for various organisations. Infrastructure Victoria supports this \ Provide financial support for local recommendation. governments to transition to minimum standards, where necessary. The Victorian Government has indicated in the Recycling Victoria policy that it \ Consider changes to the way waste will create a new body, which will provide and material processing services are an opportunity to clarify roles and procured to address market power responsibilities. imbalances between local governments and service providers. This could include mandating participation in collective procurement processes or having these processes handled by a statewide or regional authority. 34 Local governments play a crucial role in the waste and resource recovery sector, particularly in waste collection. Recommendation 10

Key findings Infrastructure Victoria

\ Clarity in roles and responsibilities is \ Local governments play a crucial \ Local governments, individually, critical for effective and coordinated role in the waste and resource are at a disadvantage when planning and implementation of recovery sector, particularly in waste negotiating waste processing the state’s waste programs and collection. However, their collection services. activities. Greater clarity can improve roles and responsibilities are not transparency, making it easier enshrined in legislation.15 Defining \ Improved governance arrangements, to monitor performance and these roles and responsibilities in such as mandatory collective track progress.13 legislation is an opportunity to set procurement or the creation minimum standards for waste of a suitable authority, have the \ DELWP, SV and the metropolitan collection. potential to counterbalance growing WRRG are not clearly or publicly market power issues in Victoria’s reporting on the progress of \ The market for MSW recovery waste sector. individual actions, overall objectives and reprocessing services in Victoria and outcomes of their strategies is dominated by a few large players. \ In the face of recent major in a way that enables industry and Victoria’s approach to procuring disruptions to the sector, responsible community to track their progress. collection and recovery services agencies worked together to has, in part, contributed to this minimise the amount of recyclable \ Differences in service provision problem by creating consolidation materials that went to landfill. between local government areas in the market as businesses bid Having a clear lead agency and limits the ability to have consistent for larger and larger numbers of decision-making powers for this 14 statewide education and can create council contracts to achieve work would have streamlined confusion for households, leading to economies of scale. processes. contamination of material streams.

13 Victorian Auditor General’s Office (2019) Recovering and 14 ibid. 15 Infrastructure Victoria (2019) Legislative and Reprocessing Resources from Waste regulatory review 35 Recommendation 11 Improve the quality and use of data to support resource recovery

Context Recommendation

Advice on recycling and resource recovery The Victorian Government’s The Victorian Government can implement planning and policy decisions its commitment to modernising Victoria’s need to be informed by reliable waste data by: data on recycling and resource \ Introducing new data reporting recovery. Gaps in data create requirements in regulatory and issues for policy and strategy contractual conditions for recycling implementation, particularly and resource recovery operators. in monitoring progress \ Providing clearer guidance to local towards targets (refer to governments and recycling and resource

Infrastructure Victoria Recommendation 12). recovery operators on how to report data in a standardised, consistent way. The responsibility for data collection is currently shared by SV, the EPA, local \ Introducing new controls and quality governments and the WRRGs. SV has assurance to verify and validate data. responsibility for coordinating reporting \ Implementing enhanced data analysis of this data. There is significant scope to evaluate the data gathered through to improve the quality and coverage the above recommendations. This of data currently published by SV. should include monitoring for perverse In Recycling Victoria: A new economy, outcomes, identifying risks to performance the Victorian Government has committed (by sector and material) and identifying to modernising Victoria’s waste data. Data opportunities to realise circular economy on the state of Victoria’s recycling sector outcomes (e.g. where waste from one reports 69% of materials are currently business can be used for production recovered for recycling. However, this in another business). data does not include information on \ Regularly reporting performance data whether the recovered material is recycled, to improve transparency in the sector. illegally dumped or has some other fate. \ Ensuring Victorian data quality standards align with other Australian jurisdictions.

36 Key findings Recommendation 11

\ Introducing new data reporting \ There is scope to improve data – introduce a new waste and requirements and providing guidance provision and reporting in waste resource recovery data system to on how to report data would processing contracts. This can enable better waste management improve the coverage and quality support improved outcomes for and circular economy monitoring of information on the fate of materials as well as contingency – expand waste and recycling

recovered materials and help planning for sector disruption. Infrastructure Victoria overcome issues with data quality. market intelligence reporting \ Data reporting and governance \ A 2011 report by VAGO on requirements should be specified – improve the usefulness and MSW management found that where legislation is used to define accessibility of Victorian waste deficiencies in data quality had the scope of different government data to local governments, reduced the reliability of performance entities, including local industry and the community. data, and that complete, timely, governments.18 \ Clear governance for a data accurate data is necessary to improvement program is required effectively report on performance.16 \ Timely data publishing can improve transparency and accountability for efficient delivery. Costs are \ Data is often collected through around the performance of the sector uncertain but may be in the voluntary surveys of local and inform education and behaviour range of $20 million over three governments and waste recovery change campaigns. It can also assist to five years. and reprocessing operators, so to predict disruption to or emerging is incomplete and not necessarily gaps in the system. Victoria’s accurate. 2017-18 data was published in September 2019. \ There is scope to impose data requirements on operating \ Data governance and system licenses within the waste and improvements should meet resource recovery sector through the following objectives: amendments to the Environment Protection Act 1970. Licencing – establish a framework for conditions should require regular, monitoring progress towards periodic reporting of material the circular economy, including flows data at all resource the identification of indicators recovery facilities.17 and metrics

16 Victorian Auditor General’s Report, Municipal Solid 17 AlphaBeta (2019) Recycling and resource recovery 18 Refer to Recommendation 10 which recommends Waste Management infrastructure in Victoria: International and Australian their role should be defined in legislation 37 comparisons, report for Infrastructure Victoria Recommendation 12 Use targets to drive performance

Context Recommendation

Advice on recycling and resource recovery In the high-performing To leverage the adopted targets, international and Australian Infrastructure Victoria recommends:

jurisdictions we examined, \ In the longer-term, investigate more clear long-term vision and ambitious and complex targets (e.g. ambitious quantitative targets based on carbon emission reduction) were common. and penalties for non-compliance.

These included overall system performance \ Consider the use of existing legislative as well as waste reduction. In some and regulatory tools to improve jurisdictions, targets were statutory with performance in specific areas such as: Infrastructure Victoria non-compliance penalties. To be effective, – The application of planning and targets require rigorous data collection (see building permit conditions to establish Recommendation 11) as well as necessary performance standards for waste funding and detailed sector planning. We reduction and resource recovery support the targets that have been formally during both construction and adopted in the Victorian Government’s ongoing operations. circular economy policy – Recycling Victoria: A new economy. – The application of food business licence conditions to establish performance standards for food waste reduction and organics recovery.

– The application of EPA operating licence conditions to establish performance standards in the industrial sector.

38 Key findings Recommendation 12

\ Our analysis of places around the \ Waste management services for world with high-performing recycling multi-unit developments are not fully and resource recovery sectors shows integrated with the MSW system. that they have taken a long-term In many cases, waste management approach to targets, revisiting and services are provided directly by Infrastructure Victoria increasing these as performance commercial operators on behalf of the improves.19 body corporate, rather than by local governments. Sustainability Victoria has \ In other countries, targets are also developed the Guide to Better Practice progressing from simple weight for Waste Management and Recycling or volume-based targets to more in Multi-unit Developments to improve sophisticated carbon emission waste management practices reduction or material-specific targets. and increase recycling in multi-unit These address perverse outcomes developments. This guidance has and focus effort where the greatest now been incorporated into the environmental outcomes can Victorian Planning Provisions. be achieved. \ In the City of Melbourne, there are \ Legislative and regulatory tools high concentrations of high-rise outlined above could be used residential buildings, restaurants to implement the Government’s and cafes. City of Melbourne residents proposed new requirement for recycle only 25% of their waste, business to sort commonly which is low compared to the recyclable materials and organic Victorian average of 45%.20 This wastes from unrecoverable wastes. reflects the higher barriers and lower rates of recycling in multi- unit developments generally.21 22

19 AlphaBeta (2019) Recycling and resource recovery infrastructure 21 Quantum Market Research (2019) Kerbside Collection in Victoria: International and Australian comparisons, report for Deep Dive, report for Infrastructure Victoria Infrastructure Victoria 22 Quantum Market Research (2019) Waste Advice Research, 20 City of Melbourne (2019) Waste and Resource report for Infrastructure Victoria 39 Recovery Strategy 2030 Recommendation 13: Strengthen the status of, and processes around, Victoria’s Recycling Infrastructure Plan

Context Recommendation

Advice on recycling and resource recovery The Victorian Recycling The Victorian Government should use existing planning mechanisms to improve Infrastructure Plan (VRIP), recycling and resource recovery performance by:

formerly known as the Statewide \ Strengthening the status of the \ Developing and maintaining spatial Waste and Resource Recovery VRIP to ensure cohesion of waste data on waste generation and flows, Infrastructure Plan (SWRRIP) management and planning decisions as well as resource recovery and has provided a long-term vision across multiple levels of government. reprocessing infrastructure capacity and roadmap to guide planning Further amendment of the Victorian and capability. Planning Provisions could achieve this. for waste and resource recovery \ Facilitating the appropriate location infrastructure across the state. \ Proactively encouraging the appropriate of waste and resource recovery through

Infrastructure Victoria location of waste and resource recovery the formal development of an inter- However, the private sector primarily operations. agency working group of responsible provides waste management, resource Victorian resource recovery agencies, recovery and recycling infrastructure, \ Establishing and strengthening economic development agencies, with limited matching of strategic standardised land use buffers around and local governments considerations (like waste generation waste management sites, considering trends, land use planning or minimisation the implications of local government \ Undertaking active and transparent of costs to households and businesses) area boundaries. This would provide contingency planning to provide to the type and location of infrastructure. greater certainty to the market in greater network resilience. The objectives of the Plan are therefore developing these sites. difficult to realise. \ Including provision for waste-to-energy and landfill capacity in the VRIP, to optimise the management of residual waste in both business-as-usual (BAU) conditions and disruption.

40 Key findings Recommendation 13

\ For resource recovery and planning decisions at VCAT based operations of the waste sector reprocessing to be cost-effective on their presence in the SWRRIP. industry operators to ensure waste and for recycled products to be Although these cases are generally and resource recovery programs attractive to markets on a price won for the cause of waste are aligned with market conditions. basis, the location of particular management, going to the tribunal Improved coordination across Infrastructure Victoria industries is important. If they is funded by taxpayers and causes government could improve the are continually pushed further out delay. The Metropolitan Waste sector. The interagency working of the metropolitan area as land and Resource Recovery Group group for the Combustible Waste value increases and sensitive uses (MWRRG) is working to identify Recyclable Materials (CWRM) encroach upon them, performance and protect waste management taskforce has been effective in will decrease due to a lack of hubs of state significance through bringing together responsible suitable facilities. We found collaborative processes with local regulating agencies, aligning efforts multiple instances where waste government and other agencies. and improving communication and management and reprocessing However, the current approach and collaboration. This could serve sites are at risk from the lack of resourcing limits the completion as a model for future efforts. alignment between waste planning of the protection plans to two sites and land use planning decisions. (or hubs) per year. \ Waste-to-energy and landfills For example, a major construction will likely both play a role in and demolition (C&D) recycler in \ Currently there is limited managing waste in the future. the south eastern suburbs is likely communication and collaboration The VRIP needs to reflect this point, to lose their current site in the across government levels and while ensuring that Victoria does medium term. With no other portfolios to facilitate strategic not over-invest in capacity. suitable sites nearby, 100,000 investment in the Victorian waste \ The VRIP’s objectives need tonnes of processing capacity and resource recovery industry. to integrate with a range of may be lost. For the best outcomes, regulators need to understand the compliance government planning policies \ We have also heard from multiple status of industry operators and and plans, including land use stakeholders that government non-regulatory agencies. They also planning, economic development, agencies often appeal land use need to understand the business and resources strategies.

41 06.

What Advice on recycling and resource recovery Advice on recycling and resource recovery we found

Victoria’s recycling resource recovery system is under pressure.

Since 2015, the Victorian Government has invested more than $135 million in supporting the recycling and resource recovery sector in Victoria, to ensure Infrastructure Victoria Infrastructure Victoria continuity of service to Victorians and to minimise the likelihood of otherwise recoverable material being sent to landfill.23

42 Victoria’s recycling and resource recovery sector needs to respond to the immediate challenges facing the sector and deal with upcoming changes in national policy.

Some recyclable material is still being What we found landfilled and some Victorians have become sceptical about the fate of their China National Sword Policy recycling. In developing our advice, we polled community members and found

that a quarter of Victorians we surveyed Infrastructure Victoria believe their recycling goes to landfill.24 Like many countries around the world, plastics, plummeted. Victorian In the past 18 months, Victoria has seen Victoria has relied on international operators scrambled to find new recyclable material being sent to landfill markets to accept some recovered export destinations for these after a major materials recovery operator material. In 2016/17, a significant materials. This was repeated closed. In Victoria, particularly metropolitan amount of Victoria’s waste exports – on a global scale, with developed Melbourne, the recovery and processing nearly all plastic exports and 75% of economies looking to redirect sector is concentrated, so there is limited paper and card – went to China. The collected recyclables to other competition. Market concentration also introduction of the China National waste markets throughout Asia. means there is little incentive for operators Sword policy placed strict limits on to improve and limited redundancy in the the level of contamination China China National Sword shone a sector. This leaves Victoria vulnerable to would accept in recovered materials. spotlight on the fact that a number of commercial or global shifts. Victoria’s major MRF operators were Before China National Sword, many operating as recovery businesses, Responding to these challenges requires Material Recovery Facilities (MRFs) not actual recyclers. Their practice a combination of short and long-term were paying Victorian councils for of collecting and storing materials initiatives. Victoria’s recycling and resource recyclables, which subsidised the to take advantage of economies of recovery sector needs to respond to the cost of collecting Municipal Solid scale for recovery led to stockpiles of immediate challenges facing the sector Waste (MSW). MRFs then sold these combustible materials. These posed and deal with upcoming changes in national materials to China. After China significant fire risks to the Victorian policy. At the same time, all Victorians need National Sword, the global price for community as the market for to take a different approach to waste. materials, particularly paper, card and the materials dried up. Long-term, waste reduction and avoidance will assist to ensure the circumstances of the past 18 months are not repeated.

23 Department of Environment, Land, Water and Planning 24 Quantum Market Research (2019) Waste Advice 43 (2020) Recycling Victoria: A new economy Research, report for Infrastructure Victoria Improved waste avoidance, recycling and resource recovery are key in a circular economy Advice on recycling and resource recovery Waste is a growing by-product of Figure 2: Preferred waste outcomes What we found modern life. A growing population and increasing consumption mean the amount of waste is growing in Most preferable line with our demand for products

and services. Unless Victorians change Infrastructure Victoria Avoidance their approach to waste, the need for recycling and resource recovery infrastructure will also continue to Reuse grow to deal with ever-increasing quantities of material. Infrastructure Victoria

Recycling, re-use and recovery all lead Recycling to positive outcomes and are better than simply disposing of waste to landfill. The waste hierarchy shows the best ways Recovery of energy to deal with waste, avoidance being the most preferable. Managing waste in line with the waste hierarchy is legislated Treatment in Victoria through the Environment Protection Act 1970 (the EP Act). Containment Avoidance is at the top of the waste hierarchy. Re-using, recycling, recovering energy and disposing of waste all incur Disposal economic and environmental costs. As the scale of these tasks grows, so will Least preferable the costs. The most cost-effective way to manage waste is to create less in the first place.

A policy approach that prioritises transitioning to a circular economy can In February 2020 the Victorian While investment in resource recovery support a long-term focus on avoidance, Government released Recycling infrastructure is essential for the immediate re-use and recycling. A circular economy Victoria: A new economy, which outlines and medium-term stability of the sector, aims to reduce the environmental impacts its vision for how materials are used a circular economy could reduce the of production and consumption, along with and managed, and provides long-term significant, growing pressure on the more productive use of natural resources.25 direction for the sector. sector by reducing the material it needs 44 to manage. Waste generation in Victoria, now and into the future

A circular economy could also improve the Victoria’s recycling and resource This poses a significant task for What we found quality of recyclable material collected and recovery sector manages increasingly the Victorian recycling and resource increase demand for recovered materials. large amounts of waste from recovery system. Without changes to three sectors: the way products are designed, consumed In this advice, we consider some of the and disposed of, this task is only going challenges facing the recycling and \ Municipal Solid Waste (MSW). MSW is to get bigger as our population and Infrastructure Victoria resource recovery sector in Victoria, waste managed by local governments. economy grows. focusing on boosting resource recovery Most MSW comes from kerbside bin rates and promoting use of recycled collection services (predominantly from Unless Victorians change how they think material. However, many of the solutions households, along with some small about waste, the resource recovery sector proposed will be costly to sustain in the businesses). MSW tends to be separated will need to significantly expand its capacity long-term, unless Victorians change their into three streams: garbage, commingled to deal with different materials, especially if attitudes to waste. Reducing the amount recycling and food and garden organics. Victoria is to improve its recovery rate and of waste Victorians generate will not only In 2018, about 3 million tonnes of MSW reduce the amount of material going to help to manage these costs, but also was generated in Victoria, which is landfill. In 2018, an estimated 10 million reduce pressure on finite natural resources around 21% of the total waste stream.26 tonnes of material was recovered and 4.4 and lessen the environmental impacts million tonnes went to landfill – a recovery of production and consumption. \ Commercial and Industrial waste (C&I). rate of about 69%. If Victoria simply C&I is waste generated by business maintains the status quo in terms of and industry. About 4.8 million tonnes resource recovery, the sector will need of C&I waste was estimated to be to be able to process over 12.5 million Re-using, recycling, generated in Victoria in 2018, which is tonnes of material by 2038/39. recovering energy and around 33% of the total waste stream. The past 18 months have shown that the disposing of waste all incur \ Construction and Demolition Waste status quo is unsustainable. More of the (C&D). C&D waste comes from economic and environmental materials recovered for recycling are being construction and demolition and can be stockpiled or disposed of in landfill due to costs. The most cost- collected as mixed or segregated lack of an end market, which means the streams. C&D is the largest part of the effective way to manage 69% of resources that are recovered waste stream, making up an estimated are not all being recycled. We have an waste is to create less in 46% of total waste generated in Victoria opportunity to truly recycle these materials in 2018 – about 6.6 million tonnes. the first place. for other uses. However, Victoria’s recycling and resource recovery system lacks the Across all three sectors, a total capacity and capability required to process of 14.4 million tonnes of material is recovered materials to a standard that estimated to have entered the waste 25 Department of Environment, Land, Water and Planning means they can be re-used locally or (2019) A circular economy for Victoria – Creating more pathway in 2018. value and less waste exported for re-use overseas.

26 Blue Environment (2019) Victorian waste flows projections, report for Infrastructure Victoria 45 Advice on recycling and resource recovery Figure 3: Recovery of household and commercial waste is low, and is an opportunity

Infrastructure Victoria

Waste enerated tonnes Waste onstruction oercia unicia eoition Industria oid Waste

Landfilled Recovered Source: Blue Environment

Each type of material (i.e. paper and These include improving infrastructure cardboard, organics, glass, plastics) will capacity and capability for processing, require particular processing with different developing end markets, or reducing infrastructure to meet our growing needs, the amount of these materials entering and each will have different end markets. the recycling and resource recovery Therefore, it is important to understand the system altogether. projected growth for each material stream.

Priority materials are plastics, glass, organics, paper and cardboard, tyres and Each type of material e-waste. The following section looks at each of these materials in more detail. We (i.e. paper and cardboard, have identified opportunities to improve the organics, glass, plastics) will recycling and resource recovery rates for these materials through a mixture of policy require particular processing and infrastructure responses. with different infrastructure 46 to meet our growing needs. There are six priority materials for the sector to manage

While Victoria’s overall recovery rate paper and cardboard, by 1 July 2024. With the introduction of the ban, Victoria will What we found is relatively high, the recovery rate for Value-added materials can still be exported need to ensure materials can be processed each material varies significantly. This under the proposed ban. These include: to meet the export standards, and develop depends on how easy the material is local markets for recovered materials. to recover, its quality, and how strong \ Plastic: clean plastics sorted to a single resin type and processed ready In our advice, we are focusing on end markets are for that material. Infrastructure Victoria for further use (e.g. flakes and pellets). organics, e-waste and the four materials Metals, for example, have a high recovery covered by the proposed export ban. rate (around 91%). Metals are relatively \ Paper: paper pulp and These materials either: simple to recover and process and have single stream bales. a relatively high value in end markets. \ align with specific elements of the \ Glass: cullet ready for further use. Plastics, on the other hand, have a low terms of reference for this advice recovery rate (around 23%) due to the \ Tyres: crumb rubber, powder \ make up a high volume of material complexity and cost of recovering and and granules, shredded tyres entering the recycling and resource processing them, and weak end markets. for tyre-derived fuel or bus, truck and recovery stream aviation tyres for re-treading. For Victoria to increase its overall recovery \ have low recovery rates rate, we need enough capacity and Victoria has relied heavily on export capability to process increasing amounts markets for recovered materials. \ represent a high environmental impact of a range of materials. At the same time, the way we process these materials needs \ have a combination of these factors. to change if Victoria is to meet the policy Figure 4 shows a range of materials objectives announced by the Council of assessed against these criteria. Materials Australian Governments (COAG) in March Metals have a high recovery including masonry, metals and textiles 2020, which progressively bans export rate because they are do not meet as many of the criteria and waste from 1 July 2020. We also need to have been excluded from in-depth analysis. change to meet the increasingly high import relatively simple to recover The proposed export ban reinforces standards from international markets. and process and have a the need to improve Victoria’s recycling The COAG export ban will require a high value. Plastics, on the of these materials. step-change in recycling and resource other hand, have a low recovery in Victoria. The ban will be introduced in phases over the next recovery rate due to the two years, starting with the export of complexity and cost of unprocessed glass, which will be banned by July 2020, followed by mixed waste recovering and processing plastics by July 2021, all whole tyres in them, and weak markets. December 2021 (except bus, truck and aviation tyres for re-treading), and mixed 47 Figure 4: Some materials are more problematic than others

Organics Plastics Glass Paper & E-Waste Masonry Metals Tyres Textiles cardboard

Tonnes of material generated 2,522,497 593,983 349,313 2,024,337 84,662 6,633,503 1,610,570 64,164 192,894

Tonnes of materials 1,096,433 138,981 267,846 1,500,784 67,147 5,576,791 1,473,986 57,916 168 recovered

Recovery rate 43% 23% 77% 74% 79% 84% 92% 90% 0%

Proportion of waste 2% 7% 3% 32% 1% 0% 31% 62% 0% Advice on recycling and resource recovery generated that is exported*

Indicator of Methane Litter, micro Stockpile Fire risks Hazardous Inert Leaching Fire risks Not environmental hazard plastics in safety significant wasterways, food

Net environmental High Medium High High Not Not High Not Not benefit of recycling** assessed assessed assessed assessed

Opportunity to increase High High High High Medium Low Low Medium Low value adding in Vic***

Infrastructure Victoria Data from Blue Environment * based on SV/RMIT 2013 method, considers CO2, *** estimate of economic opportunity considering likelihood energy & water saved only that export market will decline and/or local supply will increase, potential for value-added local or export uses, commodity ** red means export markets at risk from export ban value uplift likely from changes to sorting and collection

Our analysis of the current infrastructure capacity for these priority materials identifies 430 facilities across Victoria. Figure 5 summarises these facilities.

Figure 5: Resource recovery infrastructure comes in many different forms

Infrastructure type Paper & Plastics Glass Tyres Organics E-waste Multiple cardboard

Processing Infrastructure

Reprocessing Facility 9 32 6 3 19 4 -

Recovery Infrastructure

Specific Materials Recovery Centre 7 - 1 5 5 24 -

Materials Recovery Facility ------13

Resource Recovery Centre 1 - - - - - 265

Bulk Haul Consolidation Centre ------1

Drop-off Centre - - - - - 6 15

Other ------14

48 Source: Brock Baker Environmental Consulting In addition to the COAG export ban, National Packaging Targets and we have assessed the impact of other the National Waste Policy Action Plan policy changes already announced by the Australian and Victorian Governments that focus on improving recycling and resource recovery, specifically the National The Australian Government and other In 2018, the Australian Government Waste Policy Action Plan targets. We have state and territory governments have released the National Waste Policy: modelled the impact of these targets in adopted targets initially proposed by Less waste, more resources. The our analysis and, where relevant, discussed the Australian Packaging Covenant policy was agreed on by Australia’s What we found their potential impact on the infrastructure Organisation (APCO) to greatly improve Environment Ministers and the and market development that will the management of packaging waste President of the Australian Local be needed. by 2025. The four targets for 2025 are: Government Association in December 2018. Here we assess the projected generation \ 100% reusable, recyclable or Infrastructure Victoria and processing capacity for each priority compostable packaging The National Waste Policy Action material to show the potential infrastructure Plan presents targets and actions required for each to meet the COAG waste \ 70% of plastic being recycled for its implementation. The Action ban requirements and particular recovery or composted Plan established a target of 80% rates (%RR). The data used in this section average resource recovery from all \ 30% of average recycled content are based on future projections, and should waste steams following the waste included in packaging be considered approximate only. Figure 6 hierarchy and a 50% reduction summarises our analysis, with further \ phasing out problematic and in food waste by 2030. The plan details below. unnecessary single-use plastics. is intended to complement and support the implementation of the national packaging targets. Figure 6: Reprocessing capacity varies by material

2025 2030 2039 Priority material (COAG ban & 70% RR) (80% RR) (90% RR)

Paper and cardboard

Plastic

Organics

E-waste

Glass

Tyres 49 Plastics

Advice on recycling and resource recovery Seven different categories of plastics Figure 7: End-of-life plastic generation is expected to grow in Victoria are recovered in Victoria. End-of-life plastics are forecast to increase from 586,300 tonnes in 2018 to more than 735,000 tonnes in 2039.27

Around 130,000 tonnes of plastic were recovered in 2018, or 23%. Over half

of the plastic recovered comes from MSW. The majority is commercial and industrial packaging material. Infrastructure Victoria Recyclability varies depending on plastic type. Polyethylene terephthalate (PET) and

high-density polyethylene (HDPE) tend onnes to have higher recovery rates than other types of plastic. Recovery rates also vary across sectors. Recovery rates of MSW Source: Brock Baker Environmental Consulting plastics were estimated at around 32% in 2018, with C&I and C&D at 18% and 10% respectively. Figure 8: Plastics processing shortfall is expected by 2025 Victoria has the capacity to manage end-of-life plastics at current recovery rates 2025 (COAG ban and 2030 (80% 2039 (90% until 2022, but the challenges go beyond Priority material capacity. Victoria, like many jurisdictions, 70% recovery rate) recovery rate) recovery rate) relies heavily on export markets for plastics, Generation 641,100 676,700 735,300 with around 63% of recovered plastics Current processing 160,050 160,050 160,050 exported for processing offshore. The infrastructure capacity COAG Waste Export Ban will stop mixed Projected recovery required 448,700 541,300 661,800 and unprocessed plastics from being to meet policy settings exported. Excess or shortfall -288,650 -381,250 -501,750 The COAG Waste Export Ban requires in capacity that from July 2021, the export of mixed plastics that are not of a single type (i.e. they require further sorting, cleaning, and reprocessing before they can 50 be remanufactured) will be banned. 27 Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, report for Infrastructure Victoria, and Infrastructure Victoria analysis By June 2022, this will extend to single- There is also a gap in capacity to sort What we found resin plastics that have not been re- mixed plastics from MRFs, with no processed (e.g. cleaned and baled market for recovered material. This PET bottles). From July 2022, only clean means material is either being stockpiled plastics sorted into a single resin type or landfilled. Because resource recovery

and processed for further use (e.g. flakes rates for plastics are very low, at 23%, Infrastructure Victoria and pellets) will meet the new export significant change in people’s recycling requirements. National recovery targets behaviour is also necessary to complement of 70% for plastics by 2025 and 80% any infrastructure upgrades. overall recovery by 2030 further complicate this, as shown in Figure 8.

Victoria has limited infrastructure to sort or process plastics so they can be used locally or exported. Victoria’s collections systems and MRF sorting infrastructure cannot sort plastics adequately by type (plastics codes 1 to 7) or process these into value-added flakes and pellets for use as plastics feedstocks.

There is an immediate need to plan for investment in plastics reprocessing infrastructure in Victoria. Investment will also be necessary to meet the APCO and National Waste Policy target recovery rates of 70% and 80% in Melbourne and regional Victoria, respectively. Current plastic processing facility capacities range anywhere from 100 to 15,000 tonnes. Most regions generate enough plastic waste to support new infrastructure, as long as there is a market for the recovered material.

51 Glass

Advice on recycling and resource recovery The amount of end-of-life packaging Figure 9: End-of-life glass generation will grow by 2039 glass is forecast to increase from 344,000 tonnes in 2018 to more than 442,000 tonnes in 2039.28

About 264,000 tonnes of glass were recovered in 2018, around 77%. Of this, MSW recovery rates were 87%. This glass was made up of packaging glass such as jars, bottles and other containers. C&I and C&D make up very little of the material Infrastructure Victoria stream — 2% and 0% respectively. Glass recovered from C&I is mostly packaging glass. There is limited data on other glass

types generated by C&I, and no data on onnes glass recovery from C&D.

There are two main markets for recovered Source: Brock Baker Environmental Consulting packaging glass:

\ recycling into new glass packaging, such as bottles and jars

\ recycling into glass sands, aggregates Figure 10: Glass processing is sufficient and other uses, such as abrasives, beads and rendering. 2025 (COAG ban and 2030 (80% 2039 (90% Priority material The capacity and capability of 70% recovery rate) recovery rate) recovery rate)

infrastructure to meet these markets Generation 382,000 404,900 442,600 varies. In Victoria, two beneficiation plants recover glass cullet from packaging Current processing 494,200 494,200 494,200 infrastructure capacity glass as feedstock for glass manufacturing, and there is only one manufacturer Projected recovery required 267,400 323,900 398,400 of glass packaging. This reliance on to meet policy settings a single manufacturer is a potential Excess or shortfall 226,800 170,300 95,800 risk for future glass reprocessing. in capacity

52 28 Brock Baker Environmental Consulting (2020) Waste and Source: Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Resource Recovery Infrastructure Data and Spatial Analysis, Data and Spatial Analysis, report for Infrastructure Victoria, and Infrastructure Victoria analysis report for Infrastructure Victoria However, recovering glass for use as fragments that are difficult to recover What we found glass sand is growing in Victoria. There with existing MRF and glass beneficiation has been significant new investment in infrastructure. resource recovery in this area, supported by changes to construction specifications, Glass sand will play a vital role as virgin sand becomes scarce due to growing which have increased how much recycled Infrastructure Victoria glass sand can be used in road and rail demand for infrastructure. Scarcity construction. Victoria’s infrastructure of virgin sand is leading to significant construction pipeline provides a significant increases in cost, and in many metropolitan market for these materials. uses, recycled glass sand is very cost competitive. Using glass sand will also As Figure 10 shows, across these two reduce the need to quarry for virgin uses, there is expected to be enough sand. This will support a circular economy infrastructure capacity to manage end- in which already extracted natural resources of-life glass generation and recovery continue to cycle through the economy. rates over the next 20 years. The capacity for packaging glass and Using materials at their highest value for glass sand reprocessing only exists in as long as possible is key in a circular metropolitan Melbourne. There may be economy.29 Turning recycled glass into opportunities to invest in small-scale glass sand rather than back into glass glass crushing infrastructure in regional packaging can be seen as ‘downcycling’. areas, allowing these facilities to process However, with limited domestic demand locally collected glass packaging into for glass production, glass sand will be glass sand for use in local roads. particularly important in resource recovery This would require the collection and end markets. Glass sand is also one of the aggregation of glass in regional hubs. only end-uses for glass fines – small glass

Turning recycled glass into glass sand rather than back into glass packaging can be seen as ‘downcycling’. However, with limited domestic glass production, glass sand will be particularly important as a market for recycled glass.

53

29 Department of Environment, Land, Water and Planning (2019) A circular economy for Victoria – Creating more value and less waste Organics

Advice on recycling and resource recovery Organics include food organics (FO), Figure 11: More organic waste is expected over time garden organics (GO), mixed food and garden organics (FOGO), timber and biosolids.

Organic material is one of the largest waste streams in Victoria, estimated to make up around 35% of household garbage bins.30 Given almost all this

material can be recovered in some way, this represents a significant opportunity Infrastructure Victoria to improve resource recovery. In 2018, the overall resource recovery

rate for organics in Victoria was 43%. onnes The amount of organic waste generated in Victoria is forecast to increase from 2,489,200 tonnes in 2018 to more Source: Brock Baker Environmental Consulting than 3,128,400 tonnes in 2039.

Organics recovery from MSW was 29% in 2018. This was mainly garden and timber waste. Some food waste is recovered from MSW, but less than garden and timber Figure 12: Organics processing shortfall is expected by 2025 waste. One reason for this could be the relatively small proportion of councils 2025 (COAG ban and 2030 (80% 2039 (90% offering FOGO collection. C&I sector Priority material 70% recovery rate) recovery rate) recovery rate) resource recovery rates were 58%, made up of garden, timber and food wastes, Generation 1,277,700 1,348,900 1,466,400 while recovery rates in C&D were around Current processing 764,800 764,800 764,800 91%, which mainly came from recovered infrastructure capacity 31 timber construction materials. Projected recovery required 894,400 1,079,100 1,319,800 to meet policy settings One of the biggest opportunities to improve resource recovery is by Excess or shortfall -129,600 -314,300 -555,000 in capacity increasing household food waste recovery.

54 Source: Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, report for Infrastructure Victoria, and Infrastructure Victoria analysis Currently, a significant proportion of Given the challenges What we found household food waste enters landfill in Victoria because there is no separate in processing organics – collection service, leading to an MSW particularly the recovery rate for food of 10.6%.32 However,

more local governments are introducing infrastructure and buffer Infrastructure Victoria kerbside FOGO collection, which is zones required – the expected to increase FOGO recovery over time. Based on current FOGO recovery opportunities for significant rates, our analysis suggests there is enough new reprocessing will capacity to recover FOGO from households and businesses through to 2022. Beyond be in regional Victoria. 2022, we expect there to be a shortfall, particularly if more local governments introduce kerbside FOGO collection.

Metropolitan Melbourne will need more capacity to manage current and future organics recovery. Given the challenges in processing organics material – particularly the infrastructure and buffer zones required – the opportunities for significant new reprocessing in Melbourne will likely be limited and small-scale. A more practical solution is to aggregate and consolidate organic material, with initial processing that reduces weight and volume followed by transport to regional areas for additional processing and use. Regional Victoria will also need more capacity to manage its organic waste.

30 Sustainability Victoria (2014) Victorian Statewide Garbage Bin Audit 2013 31 Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, report for Infrastructure Victoria 32 ibid. 55 There is an immediate need to plan for future investment in paper and cardboard reprocessing infrastructure in Victoria, particularly to meet the COAG Waste Export Ban.

Paper and cardboard

Advice on recycling and resource recovery Paper and cardboard includes Figure 13: End-of-life paper and cardboard volumes are expected to mixed paper and cardboard, office increase paper, and newspapers and magazines. End-of-life paper and cardboard is forecast to increase from 1,997,800 tonnes in 2018 to more than 2,491,500 tonnes in 2039.33 (see Figure 13) The overall recovery rate for paper and cardboard in Victoria was 74% in 2018. The vast majority of recovered paper Infrastructure Victoria and cardboard in Victoria comes from the C&I sector, with a resource recovery rate of 81%. Paper and cardboard collected

directly from businesses is a single type onnes (a clean stream) making it easier to process and more valuable. Paper and cardboard

from MSW, however, is mostly commingled Source: Brock Baker Environmental Consulting and has a recovery rate of around 35%.34 C&D only accounts for a small amount of recovered paper and cardboard.

There is currently enough capacity to manage end-of-life paper and cardboard Figure 14: Paper and cardboard processing shortfall is immediate in Victoria. However, once the COAG export

ban comes into effect, there is expected 2025 (COAG ban and 2030 (80% 2039 (90% Priority material to be a reprocessing shortfall from 2024 70% recovery rate) recovery rate) recovery rate) onward. The COAG Waste Export Ban Generation 2,178,400 2,296,300 2,491,600 requires that by July 2024, all mixed paper and cardboard be banned from export. Current processing 1,116,105 1,116,105 1,116,105 infrastructure capacity Paper will need to be pulped or sorted by paper type in order to be exported. Projected recovery required 1,524,900 1,837,000 2,242,400 to meet policy settings

Excess or shortfall -408,795 -720,895 -1,126,295 in capacity

56 Source: Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, report for Infrastructure Victoria, and Infrastructure Victoria analysis There is an immediate need to plan for To meet the COAG Waste Export Ban, What we found future investment in paper and cardboard Victoria will need to invest in more paper reprocessing infrastructure in Victoria. pulping or more paper type separation at MRFs. Most paper and cardboard reprocessing in Victoria is located in metropolitan Infrastructure Victoria Melbourne with one notable paper mill, 33 Brock Baker Environmental Consulting Australian Paper, in regional Victoria. 34 There are several conflicting data sources in the public domain for paper and cardboard and it is suspected that the MSW recovery rate for paper and cardboard may actually be around 50%.

57 Tyres

Advice on recycling and resource recovery Tyres are a composite product made Figure 15: End-of-life tyres are expected to increase by 2039 from natural and synthetic rubber, steel, carbon, fibre and bonding agents. Tyres are shredded to separate the materials, most of which have markets for recovery. The amount of end-of-

life tyres is forecast to increase from 91,700 tonnes in 2018 to more than 113,000 tonnes in 2039.35

In 2018, the overall resource recovery Infrastructure Victoria rate for tyres in Victoria was 87%. Of this, MSW recovery rates were 100%. This is because only a small proportion of tyres are managed through the MSW sector. onnes These are usually tyres that are disposed of at Resource Recovery Centres and

Transfer Stations, or collected through Source: Brock Baker Environmental Consulting the clean-up of tyres dumped on local government land. Whole tyres are banned from landfill in Victoria, but shredded tyres can be disposed of in landfill.

The vast majority of tyres in Victoria are Figure 16: Tyre processing capacity is sufficient managed through the C&I sector with a

resource recovery rate of 83%. This is 2025 (COAG ban and 2030 (80% 2039 (90% Priority material because end-of-life tyres are removed at 70% recovery rate) recovery rate) recovery rate) and collected by tyre retailers when new Generation 99,700 104,900 113,600 tyres are fitted. A contractor then removes tyres from these premises for processing Current processing 112,500 112,500 112,500 infrastructure capacity or export. Data indicates that there are some tyres entering landfill. C&D does not Projected recovery required 69,800 83,900 102,200 contribute to generating end-of-life tyres. to meet policy settings Excess or shortfall 42,700 28,600 10,300 in capacity

35 Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, 58 report for Infrastructure Victoria Source: Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, report for Infrastructure Victoria, and Infrastructure Victoria analysis There are three main pathways for There have been several attempts at What we found recovered end-of-life tyres: regional reprocessing through pyrolysis (thermal treatment), but so far none \ baling of tyres for export as Tyre have been successful. In fact, proposed Derived Fuel or as casings for pyrolysis facilities have resulted in notable re-tread/seconds markets stockpiles such as those at Stawell and Infrastructure Victoria Numurkah, both of which have recently \ shredding of tyres for export been cleaned up by the EPA and as Tyre Derived Fuel respective local governments, at \ further reprocessing into feedstocks a cost to Victorian taxpayers. such as crumb rubber, granules or powder.

Victorian infrastructure capacity and Given the high level of capability are different for each of these investment mechanical recycling pathways. The COAG Waste Export Ban requires that by December reprocessing of tyres 2021, all whole tyres, including baled requires to create tyres, will be banned from export, except for bus, truck and aviation tyres for shred or crumb rubber, re-treading. Tyres will need to be shredded it is likely that future for use as tyre derived fuel, or further processed into crumb rubber, granules investments will continue or powder. to be in Melbourne. Figure 16 shows there is enough mechanical infrastructure in Victoria to shred or crumb tyres to meet a range of product requirements. There is no immediate need for future investment in tyre reprocessing infrastructure in Victoria.

All major tyre reprocessing in Victoria is located in metropolitan Melbourne. Given the high level of investment mechanical reprocessing of tyres requires to create shred or crumb rubber, it is likely that future investments will continue to be in Melbourne. 59 E-waste

Advice on recycling and resource recovery E-waste covers a wide range of Figure 17: E-waste is projected to grow electronic items – anything with a battery or a plug – including televisions, computers, mobile phones, kitchen appliances and whitegoods. These items can contain both valuable and

hazardous materials. E-waste is forecast to increase from 83,400 tonnes in 2018 to more than 106,500 tonnes in 2039.36

In 2018, the overall resource recovery Infrastructure Victoria rate for e-waste in Victoria was 79%. Since then, an e-waste landfill ban was introduced in July 2019. As a result, we expect a drop in reported e-waste disposal onnes to landfill. As e-waste is such a broad category it is important to note that

approximately one third of e-waste in Source: Brock Baker Environmental Consulting Victoria is made up of large household appliances, i.e. whitegoods that are predominantly metals.

These materials are largely managed by metals recyclers, not dedicated Figure 18: E-waste processing shortfall is expected by 2030 e-waste recyclers. As Figure 18 shows,

based on the best available data, there 2025 (COAG ban and 2030 (80% 2039 (90% Priority material is enough reprocessing capacity to 70% recovery rate) recovery rate) recovery rate) manage e-waste containing hazardous Generation 63,400 67,100 73,200 materials in the short-term, with a small shortfall from 2030 onward. Current processing 49,400 49,400 49,400 infrastructure capacity

However, waste projections suggest Projected recovery required 44,400 53,700 58,500 increasing tonnages of hazardous items to meet policy settings that are yet to reach their end of useful Excess or shortfall 5,000 -4,300 -9,100 life, such as solar photovoltaic panels in capacity (PVs), entering the waste stream in future.

60 36 Brock Baker Environmental Consulting (2020) Waste Source: Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure and Resource Recovery Infrastructure Data and Spatial Data and Spatial Analysis, report for Infrastructure Victoria, and Infrastructure Victoria analysis Analysis, report for Infrastructure Victoria What we found

E-waste: The waste of the future, today Infrastructure Victoria

Future e-waste is likely to look PVs. End-of-life management is also transitioned to battery electric vehicles, very different from current forecasts important to protect the environment the volume of lithium battery waste and due largely to two technologies – and human health from the uncontrolled other e-waste generated would exceed one existing and one emerging – release of hazardous materials. current projections and infrastructure solar PVs and electric vehicles. plans. We recommended the Victorian PV panels and system components Government make changes to the Currently, low volumes of PV system have an estimated average life span Statewide Waste and Resource components enter Australia’s waste of approximately 25 years and are Recovery Infrastructure Plan to stream, with minimal impact. However, expected to enter Australia’s waste incorporate the impacts of automated solar PVs are an emerging e-waste stream in significant volumes from and zero emissions vehicles. stream. Industry and government are around 2023, due to the recent boom concerned that there will be insufficient in solar installations since 2010. In Without proper planning, e-waste options to safely dispose of end-of-life Victoria alone, it is estimated that by could greatly exceed the capacity PV system components across 2035 there will be 22,000 tonnes of waste infrastructure, leading to Australia, as well as a lack of of PV panel waste requiring disposal. increased illegal dumping, stockpiling established reprocessors and recyclers or illegal exporting – issues that are capable of recovering valuable and In addition, automated and zero already a concern for e-waste. hazardous resources. emissions vehicles are emerging technologies that could also produce Finally, there is also the potential As PV equipment reaches the significant volumes of e-waste. to develop local industry to handle end of its useful life span, the level and reprocess e-waste in a more of recovery, recycling, re-use and In our Advice on automated and economically and environmentally safe disposal becomes important zero emissions vehicles infrastructure, viable manner. to the environmental benefits of we found that if the entire vehicle fleet

61 Residual waste

Residual waste is material that is unable to be recovered for alternative uses or has otherwise reached its end-of-life. Currently almost all residual Advice on recycling and resource recovery material is disposed to landfill.

Disposal is the least preferable outcome The amount of residual waste in the on the waste hierarchy, as all remaining future is highly uncertain. We estimate value of these materials is lost. There will that the combined impact of the two always be a role for landfill in broader policy interventions above could reduce waste management systems and it plays the amount of material going to landfill a particularly important role in contingency in 2038/39 by around 700,000 tonnes planning (as shown in the last 18 months). each year, with a projected 5 million However, there is an alternative to landfill tonnes of residual material going to for some residual materials that allows for landfill. Our analysis suggests that by Infrastructure Victoria some of the energy embedded in these 2038/39, Victoria will generate 650,000 materials to be recovered through tonnes per year of residual waste from waste-to-energy processes. the six priority materials alone, assuming a 90% recovery rate. Not all of this There are a number of residual waste-to- residual waste will be suitable for energy infrastructure projects currently waste-to-energy. proposed for Victoria. These have the potential to further reduce Victoria’s The need for waste-to-energy to manage reliance on landfill when combined residual waste will be highly dependent with waste avoidance and improved on efforts to reduce waste and recycle resource recovery. materials, as well as the planned landfill capacity. The Recycling Victoria policy’s If Victoria continues its current, business- stated capacity cap of one million tonnes as-usual trajectory, the amount of per year for waste-to-energy should be residual waste going to landfill is regularly reviewed to manage these projected to increase from 4.4 million uncertainties. If combined efforts to tonnes in 2017/18 to 5.7 million tonnes reduce waste generation and recycle 37 in 2037/38. Alongside developing material are not highly successful then waste-to-energy projects, Australian and there is a risk that significant amounts Victorian Governments could reduce this of residual waste will remain above the by taking steps to reduce the amount of one million tonne waste-to-energy cap materials going to landfill. This could and be consigned to landfill. include banning organic material from landfill or mandating the use of re-usable, recyclable or compostable packaging.

62

37 Blue Environment (2019) Victorian Waste flows projections, report for Infrastructure Victoria Landfills, waste-to-energy, and the circular economy What we found

Using materials for as long as The two most common forms of Further, there are some materials for possible is key to a circular waste-to-energy technologies are which containment or landfill is economy. When those materials thermal and biological. Thermal the safest and best option. no longer have a useful role to play, technologies use heat to release However, Victoria’s reliance on landfill it is often still possible to extract energy from waste, for example Infrastructure Victoria energy as an alternative to disposal. through incineration and capture is expected to decline in the long term of energy. Biological processes use as new and better ways to avoid waste The waste hierarchy shows that microorganisms that feed on organic and recover materials for reuse are recovery of energy is better than waste to produce heat, energy, developed. Waste-to-energy can disposal or containment of waste, biogas and ‘digestate’. The most support this by creating ways to because this recovers some value, common biological process is reduce the need for new landfills and reduces greenhouse gas emissions anaerobic digestion. keeping existing airspace capacity from organic waste and lessens the for unrecoverable materials into the long-term environmental impacts Both biological and thermal waste-to- future. This aligns with Victorian of landfills. energy facilities could stop some residual Government’s planning documents, waste going to landfill – particularly such as the SWRRIP, which aims to As a result, waste-to-energy is a organic material – and recover some minimise the amount of waste going pragmatic approach to managing energy from the material. The solid to landfill. residual waste, but is less desirable residues that remain could be further than waste reduction, re-use and reused and recycled. For example, The Metropolitan Waste and Resource recycling. There are some risks digestate from anaerobic digestion Recovery Implementation Plan, for associated with waste-to-energy processes could be transformed into example, does not plan for new infrastructure while also transitioning soil conditioner, while some of the landfills in the metropolitan area. to a circular economy. bottom ash from thermal processes Victoria’s circular economy policy – could be used in construction. Waste avoidance and increased recycling Recycling Victoria: A new economy – and resource recovery can reduce the Landfills will remain part of Victoria’s limits the amount of material that can amount of feedstock for waste-to-energy waste management system. be processed at thermal waste-to- infrastructure, particularly thermal Landfills can assist in residual energy facilities in Victoria. Limiting waste-to-energy plants. Conversely, waste management and sector the amount of material that can be over-investment in waste-to-energy contingency planning. They may accepted by these facilities may infrastructure could discourage transition also be the best option in regional mean that material that could viably to a circular economy. areas where there is not enough be used for recovery of energy will waste to support an economically instead go to landfill. viable waste-to-energy facility.

63 More resources, less waste

Advice on recycling and resource recovery If potentially recoverable resources We have found that prices for some are not recovered, this is a missed recovered materials are higher in South economic opportunity. Australia. For example, glass prices are higher due to the cleaner stream Figure 19 shows that based on the amount of glass recovered from CDS. This of waste recovered in Victoria and current shows that there is potential for Victoria commodity prices, the value of materials is to increase the value of its recovered $1.21 billion. Metals makes up the largest resources from improved resource share, worth $889 million, or 73% of the recovery. market. Paper and cardboard and masonry have the next largest market shares, at 8% To estimate the potential increase in Infrastructure Victoria and 7%, respectively. However, the value of market value from higher commodity a number of materials (such as plastics and values, we applied South Australian paper) has fallen significantly since the commodity prices to the amount of collapse of export markets. resources recovered in Victoria and found that they would be worth up to $2 billion.

Figure 19: Estimated value of recovered materials in 2019 – Victorian prices / South Australian prices*

E-Waste

Glass

Masonry Metals

Organics

Other wastes

Paper and cardboard Plastics

oodit aues iions Rubber VI rices rices

Source: Blue Environment (2019) and Infrastructure Victoria analysis 64 *Based on December 2019 commodity prices in Victoria and 2016/17 commodity prices in South Australia Resource recovery and recycling are higher value and more productive than disposal, creating new opportunities for employment and industry growth.

Recycling can create more jobs than disposal

Increasing the amount of value Figure 20: The Victorian recycling industry has the potential to What we found generated by the sector is also likely to generate up to 5,000 new jobs by 2039 lead to more jobs. Resource recovery activities are higher-value and more productive than disposal, creating new opportunities for employment and Infrastructure Victoria industry growth. Victoria will be well- placed to realise these opportunities, but it will require ongoing evaluation of infrastructure and policy settings. Evidence suggests that for every 10,000 tonnes of waste recycled, 9.2 jobs are generated compared to 2.8 jobs for landfill.38 Using this approach, we estimate the number of jobs in the sector could grow to around 13,200 by 2039 if the current os in Victoria stiated nuer of reccin recovery rate of 69% is maintained.

However, if Victoria increased its recovery Source: Infrastructure Victoria Analysis, Access Economics, Blue Environment rate to 90%, the number of people working in the sector could grow to over 15,600 by 2039 (Figure 20), an additional 2,400 jobs more than ‘business-as-usual’ and over 5,000 more than today. 38 Access Economics (2009) Employment in waste management and recycling, report for the Department of the Environment, Water, Heritage and the Arts

65 Figure 21: Reprocessing infrastructure is highly concentrated around Melbourne

Recovery Infrastructure Capability Population/Sq Km ioetres ain anua searation and sortin to echanica searation and sortin to ther to hreddin to tiaes si ins caes to Processing Infrastructure Capability to to naeroic iestion to Advice on recycling and resource recovery ast furnace oaction to oostin rushin rindin washin trusioninection oudin ain ranuatin cruin aardous rocessin ther aer and u hreddin nnown

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66 Infrastructure is unevenly spread

In identifying challenges and On the other hand, some materials of each arrow representing the volume of opportunities for Victoria’s regional require more space for processing, the material. It shows, for example, that and rural areas we sought feedback such as organics. more organic material flows to regional from stakeholders from local regional areas for processing than is processed councils and industry. Figure 22 illustrates the flow of materials in the metropolitan area, and that all glass in Victoria, with each arrow representing generated in regional areas is processed Our consultation identified high a different material type, and the thickness in Melbourne. transportation costs as a barrier to improving recycling and resource recovery. In many cases, it is more Figure 22: Most processing occurs in Melbourne; except for organics

economical to use landfill. Several What we found submissions identified a need for more recovery infrastructure in regional areas.

Melbourne generation Regional generation Our analysis shows there are some inconsistencies in infrastructure provision across the state. As Figure 21 shows, Infrastructure Victoria the majority of processing infrastructure – marked in red – is clustered around metropolitan Melbourne, while recovery infrastructure – marked in blue – is spread more evenly across the state.

Many of the recovery infrastructure sites Regional and Melbourne processing marked in blue are small, local resource interstate processing recovery centres. These often serve as points of aggregation for materials, with limited actual recovery occurring. Materials Key will often be transported to another facility for processing. Figure 21 also shows Tyres that there is a specific need for MRF Plastics infrastructure in the Grampians Central Organics E-waste West and Barwon South West WRRG Paper & Glass regions, as both these regions lack any Overseas processing cardboard mechanical separation and sorting infrastructure.39

This means material generated in regional areas often flows to the metropolitan area for processing. Some materials are easier to process in the metropolitan area. Due to the amount of material generated in Melbourne, metropolitan facilities tend to be bigger than regional ones. With size often comes efficiency, meaning it is cheaper and more efficient to transport some materials to the metropolitan area for processing.

67 39 Brock Baker Environmental Consulting (2020) Waste and Resource Recovery Infrastructure Data and Spatial Analysis, report for Infrastructure Victoria Waste Future infrastructure transport provision

Advice on recycling and resource recovery Moving materials is not necessarily a Overall, transporting waste is not To identify potential locations for bad thing, depending on the material. necessarily problematic, as long as it is new recycling and resource recovery High-volume or heavy materials such as optimised. As the private sector is largely infrastructure, we considered current masonry and aggregates, or glass, cost responsible for providing this infrastructure, and predicted waste generation and more to transport due to their weight. the geographic spread of facilities is reprocessing capacity by material not optimised to reduce transport costs. type, proximity to end markets, existing Organic materials may not necessarily Minimising transport costs will be important resource recovery hubs of statewide be more expensive to transport, but in improving recycling and resource significance, the statewide and regional often don’t have as much value as a recovery rates by helping recovered resource recovery infrastructure plans reprocessed material such as compost, materials become cost competitive with and stated government priorities to making them less economical to transport. virgin materials. Currently there are dozens support regional economies in transition Infrastructure Victoria In these instances, investment in regional of resource recovery centres across (for example, the Latrobe Valley). recovery and processing facilities could Victoria, of varying capacity and capability, lower transport costs, improve recovery that aggregate materials from their local Using this methodology, we are proposing rates and support end markets for these areas for transport and further recovery. 87 new or upgraded facilities, many of materials. Local recovery and reprocessing which are in regional areas. Shown in can create jobs in regional areas. Rationalising our resource recovery Figure 23, these facilities can address centre network and focusing on fewer identified infrastructure gaps, minimise Regional and rural areas are more likely centres that are more strategically transport costs, capitalise on existing to have nearby markets for reprocessed located and better resourced could resource recovery and recycling hubs organic products, such as soil conditioner reduce the costs of transporting materials. and maximise the likely economic viability and compost, and facilities to process This could encourage more aggregation of facilities. these materials due to the space available of materials, resulting in fewer trips for buffer zones. However, this needs to and better economies of scale in be weighed against cost of transport and waste transport. the ability to aggregate enough waste for a viable market.

Transporting waste is not necessarily problematic, if it is optimised. As recovery and recycling infrastructure is largely provided by the private sector, the geographic spread of infrastructure is not optimised to reduce transport costs to households and businesses.

68 Figure 23: Indicative location of required recovery and reprocessing infrastructure

Material type Population/Sq Km ioetres waste ass to ied to ranics to aer to astics res to to Infrastructure Status to

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69 Not investing can be expensive

Advice on recycling and resource recovery A number of the recommendations These are: Government recently invested $30 million we make may require spending by the to clean up a stockpile in Lara where the Victorian Government, both in upfront \ Emergency and incident response costs operator has gone into liquidation, which capital expenditure and also ongoing is a job that may take several years. \ Enforcement and regulatory costs operational expenditure. When the Stockpile fires also incur significant costs for Victorian Government decides whether \ Environmental impact and other agencies. The Ecotec Somerton fire in to make particular investments it helps restoration costs to consider both the cost of investment 2015 cost the CFA alone $2.3 million to and the potential costs to Victoria if \ Economic impact and respond to. Further costs for other agencies no investment occurs. business disruption responding to that fire included $242,000 for VicRoads’ emergency response, Infrastructure Victoria We have already seen what can occur Emergency and incident $295,145 for Melbourne Water impact with a weakened market for recyclables response costs management costs, $30,000 for Hume 42 and without sufficient infrastructure to Waste material mismanagement has City Council, and $1 million for DELWP. process recycling. VAGO noted in its 2019 seen an increase in stockpile fires, waste Enforcement and regulatory costs report that without clear state-level plans abandonment and illegal dumping. These for how to manage recyclables in this new can all be costly. Based on events of the As well as the costs of responding to environment, stockpiles will likely continue past few years, the EPA estimates that it specific incidents, there are also ongoing to grow and pose unnecessary risks, and costs Victoria around $193 million per year enforcement and regulatory costs, which 40 waste to landfills will continue to rise. to respond to avoidable waste management can increase over time if the scale and issues. This estimate is made up of $105 frequency of poor waste management We have broken down the potential million per year to respond to waste practices increase when issues arise in costs to Victoria of not increasing stockpile fires, $58 million per year in annual the sector. The 2019/20 Victorian Budget recycling and resource recovery into clean-up costs of abandoned waste sites, allowed for $204.3 million in statutory four categories, representing other and $30 million per year in clean-up costs activities and environment protection (often unplanned) investments and and lost landfill levy revenue from illegal from DELWP.43 foregone revenue from poor recycling dumping.41 As an example, the Victorian and resource recovery outcomes.

70 Without clear state-level plans to manage recyclables in this new environment, materials will likely go to stockpiles, which pose unnecessary risks, or to landfill.

Environmental impact Economic impact What we found and restoration costs and business disruption

Waste stockpile fires cause immediate and When dangerous incidents happen, the long-term environmental damage to the site costs to the state can go beyond the cost and surrounding areas. For the 2017 of the immediate response. There can also Infrastructure Victoria Coolaroo fire alone, DELWP has estimated be an economic impact on surrounding that approximately $6 million was spent on communities if businesses are disrupted. the management and clean-up of the site. The impact on the local community and This amount does not include the ongoing businesses of the 2017 Coolaroo fire was management costs and clean-up costs quantified in a recent class action, where borne by several agencies, particularly the over 200 residents of Coolaroo succeeded EPA but also Melbourne Water, Yarra Valley in a claim against the operator of the Water and Hume City Council.44 Coolaroo site, who was ordered to pay $1.2 million.45 DELWP separately estimated that the cost of this fire in business disruptions alone amounted to $200,000.46

40 Victorian Auditor-General’s Office (2019), Recovering 44 Department of Environment, Land, Water and Planning and Reprocessing Resources from Waste (2018) Management and storage of combustible recyclable and waste material, Policy Impact Assessment 41 Deloitte (2019) Regulatory Impact Statement: Proposed environment protection regulations, report for the 45 7 News (2019) Class action win for residents affected by Department of Environment, Land, Water and Planning Coolaroo recycling plant fire. Available at https://7news. and the Environment Protection Authority com.au/news/court-justice/class-action-win-for-residents- affected-by-coolaroo-recycling-plant-fire-c-378097, 42 Department of Environment, Land, Water and Planning accessed on 7 October 2019 (2018) Management and storage of combustible recyclable and waste material, Policy Impact Assessment 46 Department of Environment, Land, Water and Planning (2018) Management and storage of combustible recyclable 43 Department of Treasury and Finance (2019) Victorian and waste material, Policy Impact Assessment Budget 19/20 – Budget Paper No. 3

71 Supplements to infrastructure investment

Advice on recycling and resource recovery The Victorian Government can The Australian Government has the government could introduce product work with other governments and established a framework for product standards to exclude materials from the stakeholders to reduce the amount stewardship through the Product system that are hard to recycle. Countries of material coming into the recycling Stewardship Act 2011, a commitment that perform well, such as the Netherlands, and resource recovery system. There originally made in the 2009 National Germany and Switzerland have mandatory are multiple approaches the Victorian Waste Policy. schemes that focus on problematic Government can take to either reduce materials, like electrical equipment the amount of material entering the The National Waste Policy was updated in and packaging.49 system or increase recyclability 2018, encouraging the design of products of materials. made to last, the use of recoverable materials and minimising waste. The Infrastructure Victoria Product stewardship legislation allows for mandatory, voluntary, or co-regulatory schemes. In the eight Product stewardship, or extended years since this Act was introduced, no producer responsibility (EPR), is the shared mandatory schemes have been established. responsibility of manufacturers, retailers Around the world, Instead, existing product stewardship and consumers to manage the full lifecycle schemes tend to be voluntary, industry-led mandatory product impacts of products. schemes, such as those in place for tyres, stewardship schemes Product stewardship schemes aim to packaging products and mobile phones.47 ensure that everyone involved in making are the most effective. Product stewardship in Victoria is even and using a product shares the burden less formalised and lacks legislation. of what happens to it. This addresses However, Sustainability Victoria has one of the market failures associated undertaken product stewardship with waste, in which neither businesses partnerships for computers, batteries, who create the products that lead to waste paint and compact fluorescent lights.48 or households who consume and dispose Like the Australian Government’s approach, of products as waste are exposed to none of these schemes are mandatory and the costs of managing those materials were effectively delivered as pilot programs. once they have been disposed of. We looked at approaches to product If businesses and households are stewardship around the world and found exposed to those costs, they are more that national, mandatory schemes are likely to minimise waste and improve most effective. Mandatory schemes 47 Parliament of Victoria Legislative Council Environment and how it is disposed of. In addition, making Planning Committee (2019) Inquiry into recycling and waste tend to be easier to enforce. Mandatory management – final report producers responsible for the disposal of schemes also enable government to apply 48 ibid. products may encourage them to make more stringent product standards. For 49 AlphaBeta (2019) Recycling and resource recovery products easier to re-use or recycle. infrastructure in Victoria: International and Australian example, under a mandatory scheme, comparisons, report for Infrastructure Victoria 72 Container Deposit Scheme in Victoria What we found

A common example of a product The introduction of a CDS was Along with financial benefits, stewardship scheme is a container commonly identified by stakeholders a CDS can: deposit scheme (CDS). who provided feedback on our Infrastructure Victoria Evidence Base Report as an initiative \ act as an ‘anchor’ in a broader A CDS allows consumers to take that could improve Victoria’s waste and network of recycling infrastructure containers to collection points resource recovery system. We heard \ reduce litter (sometimes in the form of a reverse from businesses, local councils and \ improve community engagement vending machine) and deposit them individuals who advocated for the in recycling as consumers benefit in exchange for a refund. CDSs have introduction of a CDS in Victoria. when they return containers operated in Australia for some time. We separately undertook polling South Australia has had a scheme of Victorians on a range of issues, \ increase the value of recovered since 1977 and, over time, other including a CDS. In total, 92% of material while reducing collection, Australian jurisdictions have followed people we polled favoured the transport, processing and suit. Victoria has recently announced introduction of a CDS. landfill costs an intention to implement one by 2022/23. The Victorian Parliamentary Budget \ create employment Office (PBO) recently costed a CDS \ increase resource recovery. One of the key benefits of CDSs is for the Victorian Parliamentary Inquiry that they can reduce contamination. into recycling and waste management. A CDS has merit in Victoria as part This is because the different materials The PBO costed a model where the of a suite of reforms to collection and are separated at the source and are cost of the scheme is borne by drinks processing to secure cleaner materials not commingled – particularly glass suppliers and the refund for each streams and improve resource recovery and plastics. container was fixed at 10 cents. rates. This has been recognised in the Recycling Victoria policy, which Cleaner material streams can The PBO found that a CDS would commits to the introduction of a CDS. increase their potential for re-use. provide Victoria with $244.5 million A CDS can improve the chances from 2019-20 to 2022-23. This is a Further work is needed to identify the that glass containers will be $253.5 million increase in government best CDS model for Victoria, but we remanufactured into new bottles. revenue due to uncollected deposits consider the approaches taken in With plastics, a CDS allows for from containers not being returned, Western Australia and Queensland separation and remanufacturing partially offset by an increase in to be good examples. In the longer of food-grade plastics – a product operating expenses of $9 million term, a nationally consistent approach with a strong end market. to manage the scheme. to CDS should be considered.

73 Advice on recycling and resource recovery Financial incentives Product bans design considerations, it could be highly problematic to impose a ban on some Businesses that manufacture products that The most definitive legislative tool the items.51 There are alternatives to banning are later disposed of by households do not Victorian Government could use to reduce specific materials without creating often face the cost of disposal. In the residual waste is a ban on certain materials. unintended difficulties, such as product absence of costs that would change their Single-use plastics, such as plastic bags, stewardship schemes or minimum behaviour, this can lead to excessive and straws and disposable food packaging, are recycled content requirements. unnecessary waste. This market failure can commonly identified due to their high profile be addressed by putting a price on waste in discussions around waste and the through taxes or levies on virgin materials visibility of their environmental impact. to encourage greater use of recycled In November 2019, the Infrastructure Victoria content, or on specific products to In November 2019, the Victorian disincentivise their production altogether. Government banned the provision Victorian Government of single-use plastic bags through The UK Government recently implemented amendments to the Environment Protection banned the provision of a plastic packaging tax on the production Act 1970, with penalties for businesses. single-use plastic bags and import of non-recyclable plastic A similar approach could be used for other packaging that will come into effect in materials. For example, the European through amendments to 2022. This will incentivise the use of Union issued a directive in June 2019 the Environment Protection more recycled plastics and reduce plastic on the impact of certain plastic products waste. The tax was a response to high on the environment. This included a ban Act 1970, with penalties levels of plastic packaging waste, which on single-use plastic products such as for businesses. A similar predominantly came from new plastics.50 cotton bud sticks, cutlery, plates, straws, beverage stirrers, balloon sticks, and approach could be used It is difficult for the Victorian Government polystyrene food and beverage containers. for other materials. to unilaterally impose a similar tax, mostly The Member States have until 2021 to because Victoria is just one part of a larger transpose these bans into national law. market and products can flow across state borders relatively easily, limiting the impact The Victorian Parliamentary Inquiry into of a state-based tax. However, the Victorian recycling and waste management identified Government can work with the Australian difficulties with this approach. Certain Government to investigate the potential industries rely on single use plastics costs and benefits of taxes or levies on for medical or research purposes. specific materials, such as plastics or Although this problem could be addressed virgin materials. through exemptions or other ban

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50 AlphaBeta (2019) Recycling and resource recovery 51 Parliament of Victoria Legislative Council Environment and infrastructure in Victoria: International and Australian Planning Committee (2019) Inquiry into recycling and waste comparisons, report for Infrastructure Victoria management – final report Market failures are stopping the sector from performing at its best

Several challenges make the Victorian This has led to a significant power What we found recycling and resource recovery sector imbalance between firms and the local less efficient. In our Evidence Base councils seeking to procure their services.53 Report, we described the sector as a Market dynamics can also impact on the decentralised system in which sorting, full utilisation of all infrastructure where it

collecting, processing, reusing and may be to one player’s advantage to slow Infrastructure Victoria disposing of waste is done by private throughput in certain circumstances. individuals or businesses. This means it is difficult for government to achieve These market failures contribute to public policy objectives because the poor recycling and resource recovery motivations of these businesses do outcomes. In Victoria’s decentralised not necessarily align with the objectives waste management sector, where market of the Victorian Government. Market failures exist across the waste lifecycle, design approaches can help with this.52 single and centralised solutions are unlikely to be effective. A combination of policies At the same time, the market for recovery is most likely to succeed in addressing and reprocessing services in Victoria is these failures. dominated by a few large players. This is especially true of MSW recovery. Victoria relies on a relatively small number of MRF operators – a problem known as ‘thin markets’ – which makes the sector less resilient and created problems if one player exits the industry. Victoria’s approach to procuring collection and recovery services has, in part, contributed to this thin market problem. It has led to consolidation in the market as businesses bid for larger and larger numbers of local government contracts to achieve economies of scale.

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52 Centre for Market Design (2019) Opportunities to improve 53 Opportunities to improve infrastructure investment in the infrastructure investment in the Victorian waste economy, Victorian waste economy, report for Infrastructure Victoria report for Infrastructure Victoria Sorting MSW

Advice on recycling and resource recovery MSW is made up of a wide range Contamination of one bin can flow through of materials and is mostly generated the system and affect the recyclability of by households. Although a large a larger amount of material. Victorians on their proportion of the waste generated best behaviour could be reused, processed or Countries that have high rates of resource recycled, only around 39% of recovery from MSW tend to have a more MSW was recovered in 2018 with consistent approach to sorting and the remaining amount sent to landfill.54 collection. Currently, sorting and collection Victorians feel strongly about recycling. differs across Victoria’s 79 local councils. In June 2019, we undertook a There are a number of reasons MSW has Not all councils accept the same materials community survey to understand a lower recovery rate than C&I and C&D in recycling due to differences in what Victorians’ views on recycling and their Infrastructure Victoria streams. One of the biggest causes is the some processors will accept. For willingness to change. 89% of people diversity of the waste stream. Households example, some councils have contracts we surveyed were open to changing consume a varied range of products, that allow them to separate soft plastics the way they sort and dispose of their which flow through to the waste they for recycling, but others consider soft waste. A big reason for this is that generate. In some cases, the materials plastics a contaminant. There are also Victorians feel strongly about the are not suitable for recovery, and rightly multiple approaches to organics environment, and these feelings are a become residual waste. However, audits collection, including combining food strong driver of how they recycle. of landfill bins in Victoria have found that and garden organics – 19 councils allow a large proportion of material in these residents to put food scraps in their green However, the way household bins could be recovered.55 waste bin – and some councils collections currently work throws up do not separate organics at all. barriers to good recycling. Differences Contamination of materials in recycling in bins across councils and sporadic bins also presents challenges for Added to these issues, bin lid colours and and inconsistent messaging is leading processors and can have an impact on meanings differ across local government to uncertainty about what can and their recyclability. These are both problems areas. As Figure 24 shows, nine councils cannot be recycled. This doubt can that could be addressed by better source were fully compliant with the Australian lead people to put their recyclables in separation and improved sorting. Standard for Mobile Waste Containers their landfill bin, to be safe, or to throw as at December 2016. everything into their recycling bin to Sorting is the first step in waste recovery. let the system take care of it. Households (and businesses) need to invest time and effort to separate residual We also ran focus groups to waste and segregate the remaining items understand what would work for into relatively clean streams suitable for Victorians, and identified three critical 54 Blue Environment (2019) Victorian Waste Flows, recycling. Failures at this ‘front-end’ of report for Infrastructure Victoria factors that would support improved the system can reverberate through the sorting practice: 55 Sustainability Victoria (2014) Victorian whole system. Statewide Garbage Bin Audit 2013

76 Figure 24: Bin lid colours What we found are inconsistent across Melbourne Infrastructure Victoria

\ Frictionless – simple to use and ooursoours ofof araearae inin idsids ooursoours ofof oranicsoranics inin idsids ooursoours ofof reccinreccin inin idsids understand

\ Clear environmental benefits – a compelling reason, such as reducing material going to landfill

\ Consistently functional – the right bin capacity and collections approach

These findings are promising about the potential success of future efforts by the Victorian Government to affect change in households’ behaviour and provide an oours of arae in ids insightoours of what needsof oranics to be done.in ids We oours of reccin in ids Overall: know that Victorians want to recycle, and \ 9 councils are fully compliant are open to ways to do it better, so they with bin lid colour do not need much convincing to change.

\ 12 councils are compliant with What they do need, and what the recycling and organics bin lid Victorian Government can provide, colours is the means to do it (easy-to-use, more consistent infrastructure at home), \ 1 council has compliant garbage information on how to do it (clear and and recycling bin lids consistent messaging, with local nuance if needed), and confidence that their \ 9 councils have systems efforts are not wasted. that do not comply

Source: Sustainability Victoria (2019): Victorian Local Government Annual Waste Services Report 2017-18 77 Procurement of waste services

Advice on recycling and resource recovery These differences can lead to confusion information to households about which Unlike commercial business waste for households, contamination of material materials can be recycled and how to services, which are contracted, streams, and make it difficult to educate the recycle them can reduce contamination. household waste collection and sorting community about what they can recycle. services are procured by local councils. Better source separation can also lead to While households could collect and In 2017/18, contamination rates in improved resource recovery by providing transport wastes themselves, there are Victorian MSW ranged between 3% and cleaner materials streams. At a minimum, obvious cost advantages to coordinating 27%, with an average of 10.4% across our analysis suggests that either glass, or waste collection and transport. all local government areas.56 Minimising paper and cardboard, need to be collected contamination in MSW, which has the separately from commingled recyclables. To benefit, households cooperate through lowest recovery rate of the three waste their regular collection service and local Infrastructure Victoria streams, will contribute to improved Glass is a key contaminant of other councils procure these services from the resource recovery in Victoria. commingled recyclables, particularly private sector. paper and cardboard. Separating Consistency in sorting and collection can the collection of these materials could A simple tender process is used to price also make it easier for local governments reduce contamination. This should be and allocate these contracts. Households to provide information on how to recycle. supplemented by a separate FOGO pay a flat rate for this service as a Our polling of Victorians found that a collection, which could reduce the component of council rates. To build quarter of respondents did not know amount of organic material going into on economies of scale, some councils which bins things should go in, which the residual garbage bin and to landfill. have investigated pooling demand for was a barrier to sorting recyclable waste.57 waste collection services across council This suggests that providing more boundaries.58 While this can lead to short-term cost savings it can also lead to consolidation in the number of collections services, reducing competition In 2017/18, contamination rates in and driving up costs. Victorian household waste ranged between To correct this, a new auction approach could be used known as descending 3% and 27%, with an average of 10% simultaneous package smart auctions.59 60 across all local government areas. These auctions are used by governments and businesses for a range of procurement and allocation problems (e.g. allocation of aquaculture sites in Victoria, and mobile phone frequencies) and can harness competition to minimise costs and allocate contracts efficiently.

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56 Sustainability Victoria (2019) Victorian Local Government 57 Quantum Market Research (2019) Kerbside Collection Annual Waste Services Report 2017–18 Deep Dive, report for Infrastructure Victoria Funding of waste processing services

In waste collection, this type of auction Although markets generally allocate In addition, the Victorian Government and What we found minimises costs through a decentralised resources efficiently, governments can other governments throughout Australia process in which service providers can further increase investment in recycling and around the world already use a range put together combinations of collection and resource recovery. of other financial support approaches to zones through competitive bidding. create policy outcomes. Approaches such The Victorian Government actively This approach can reduce costs to as rebates, subsidies or low-interest loans Infrastructure Victoria households by mitigating the market ensures the recycling and resource could also improve resource recovery in power of service providers. recovery sector is meeting community Victoria by encouraging more competition needs and government objectives. or new technologies in the market for Grants are widely used to encourage resource recovery and processing services. industry initiatives to align with the 58 Positive network externalities arise because additional One example is the Clean Energy Finance participants to a network reduce the cost of providing Government’s strategic objectives. Corporation (CEFC) model. services to all participants.

59 Plott, Charles R. and Lee, Hsing-Yang and Maron, Travis Although grants can have some competitive The CEFC invests in clean energy (2014). The Continuous Combinatorial Auction Architecture. elements, they are essentially a form American Economic Review, 104 (5). pp. 452-456. ISSN projects in several sectors including 0002-8282 of bi-lateral negotiation between energy, agriculture, manufacturing, property, government and industry. In bi-lateral 60 Crampton, P. (2001). Handbook of Telecommunications as well as waste. In 2019, the CEFC Economics, Martin Cave, Sumit Majumdar, and Ingo negotiations, a well-informed supplier established the Australian Recycling Vogelsang, eds., Amsterdam: Elsevier Science B.V. will often benefit over a less informed buyer. Investment Fund to fund recycling projects Firms and organisations know their costs that use clean energy technologies. of production, and governments often do not. As a result, grants may not always lead to the best outcomes or value. Resource recovery grants have historically Grants may not been capped at a maximum of $500,000. always lead to the The Centre for Market Design at the University of Melbourne identified auctions best outcomes as an alternative approach that could or value. achieve these goals. Auctions can reveal information needed to efficiently allocate resources. They do this by harnessing competition between competitors to identify who wins and at what price. Well-designed auctions have been shown to achieve a given outcome at lower prices than grants.61

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61 Stoneham et al (2002) Auctions for Conservation Contracts: An Empirical Examination of Victoria’s Bush Tender Trial, Australian Journal of Agricultural and Resource Economics Governance and policy settings in the sector are not quite right

Advice on recycling and resource recovery All three tiers of government (Australian, Victorian and local) have important but different roles in recycling and The future of the Landfill Levy resource recovery. These roles are not always clearly defined in legislation or elsewhere, and often overlap. Significant gaps in legislation and regulation Established under section 70 of the The Landfill Levy can also contribute can lead to missed opportunities.62 Environment Protection Act 1970, one to poor outcomes. The impact of the of the key purposes of the Landfill Levy levy on landfill gate fees can lead to In Victoria, government waste and resource is to provide an incentive to minimise waste stockpiling or illegal dumping. recovery portfolio agencies work together

Infrastructure Victoria waste, encourage greater re-use and Also, inconsistencies in landfill levies to manage, plan and deliver services for recycling and promote investment in across state borders can encourage Victoria. These agencies collaborate to alternatives to landfill. Given that the cross-border waste flows to places reduce waste to landfill by working with amount of waste generated in Victoria where costs are lower. local councils, industry and the Australian is increasing, and is forecast to continue Government to increase the recovery to do so, the landfill levy alone is not Recognising this challenge, the National of resources where possible. providing enough of an incentive to Waste Policy Action Plan made Victoria responsible for investigating how to The relevant Victorian Government meet these objectives. harmonise waste levies across Australia agencies are the Department of As we identified in our Evidence to encourage best practice waste Environment, Land, Water and Planning Base Report, this is likely because management. This work is ongoing and (DELWP), Environment Protection Authority the cost of the landfill levy is not felt there have been recent announcements Victoria (EPA), Sustainability Victoria (SV) by manufacturers, or directly by of a Victorian levy increase as part of and seven Waste and Resource Recovery households. This suggests that the the Recycling Victoria package. Groups (WRRGs). In addition to these landfill levy should be considered agencies, local government and private just one of a suite of policies the There is an opportunity to consider sector operators deliver recycling services Government can use, including Victoria’s Landfill Levy in the broader to households and businesses. EPA, SV regulatory interventions like product context of the Victorian Government’s and the WRRGs receive most of their stewardship schemes, setting targets, policy objectives for the recycling and funding from the Municipal and Industrial supporting market development resource recovery sector. For example, Landfill Levy. and investing in infrastructure. increases to the Landfill Levy could make alternatives to landfill more cost Victoria’s current recycling and resource This aligns with what we have observed competitive, including energy recovery recovery system governance does not in high-performing jurisdictions around through waste-to-energy. Given energy deliver on the Victorian Government’s the world, where a landfill levy or tax is recovery is preferable to disposal, waste and recycling objectives. only part of a broader policy framework setting the right price is consistent with There is a significant opportunity to applied across the waste lifecycle. existing Victorian Government policy clarify policy direction and regulatory 80 application and enforcement. This could ensure that current In looking at jurisdictions with high- What we found governance structures do not slow performing recycling and resource development. Harmonising Victoria’s recovery systems, we found that an policy and strategy to improve recycling overarching policy framework for waste, and resource recovery with applicable recycling and resource recovery,

legislation and regulation could benefit the supported by specific targets for Infrastructure Victoria and can help transition toward a circular state significantly.63 In addition, a recent recycling, is the foundation.66 Targets economy. In the longer term, the Landfill VAGO report and feedback from a range can be used to incentivise performance. Levy could continue to be assessed as the of stakeholders shows confusion in the It is also important to ensure that they impact of other policies begin to be felt. Any roles and responsibilities of government have net benefits and do not place future changes to the levy rate should agencies. This may prevent the sector additional burdens on households consider the potential disruption that may functioning efficiently.64 or businesses. be caused by a sudden increase such as In 2019, VAGO also found that in the disruption to existing commercial absence of a statewide waste policy, arrangements, increased illegal dumping or Victorian agencies involved in waste stockpiling. A phased approach to Landfill management lack clarity on their priorities Levy changes could minimise this risk. and how best to use resources. In its There is also potential to put the Landfill report, VAGO found that existing waste Levy to greater use. Unspent Landfill Levy and resource recovery strategies and is held in the Sustainability Fund (the fund). plans, developed by DELWP, SV and We heard from a range of stakeholders, the WRRGs, have a range of objectives both in face-to-face consultation and and actions that do not provide clear through submissions, that more of the and coherent guidance in place of Landfill Levy should be invested in the a statewide policy. recycling and resource recovery sector. Without an overarching policy, there are 62 Victorian Auditor General’s Office (2019) Recovering and Reprocessing Resources from Waste This is supported by the Victorian no targets for agencies in the Victorian 63 Infrastructure Victoria (2019) Legislative and Government Auditor General’s Office Government to aim for or measure regulatory review against. Adding to this is the lack of (VAGO) 2019 analysis that Victoria 64 Centre for Market Design (2019) Opportunities to spends less than other jurisdictions certainty and stability of funding for improve infrastructure investment in the Victorian waste economy, report for Infrastructure Victoria on waste and resource recovery, recycling and resource recovery. This despite managing much higher presents a barrier to understanding 65 Victorian Auditor General’s Office (2019) Recovering and Reprocessing Resources from Waste volumes of waste. whether Victorian Government agencies have enough resources to perform 66 AlphaBeta (2019) Recycling and resource recovery infrastructure in Victoria: International and Australian their roles and responsibilities.65 comparisons, report for Infrastructure Victoria

81 The United Kingdom provides an international example of governance frameworks that could be adopted in Victoria to provide greater clarity.

The role of local governments and the WRRGs

Advice on recycling and resource recovery Victorian local governments are, in reduction. Currently, the WRRGs support regulator; and similarly to DELWP, the many ways, the front line of recycling councils in procuring recycling and resource UK waste management policies are set and resource recovery in Victoria. recovery services by supporting by central government. However, the Local governments are responsible collaborative procurement processes collection and processing of waste and for waste collection and recycling to achieve economies of scale. However, recycling are provided by a Waste services for their residents with it is not mandatory for councils to Collection Authority (local authorities) support from the Waste and Resource participate in procurement processes and a Waste Disposal Authority. Recovery Groups (WRRGs). run by the WRRGs, which can lead to market power imbalances between The UK’s Environmental Protection Act According to the VAGO Delivering Local individual local governments and recycling 1990 (the Act) sets out the roles and Government Services Report (September and resource recovery service providers. responsibilities for Waste Collection Infrastructure Victoria 2018), most council services are not legally Authorities (WCAs) and Waste Disposal mandated, including recycling services. Some of the roles and responsibilities Authorities (WDAs). It is prescriptive, and Current legislation gives councils the of the WRRGs, specifically for regional very specific when compared to equivalent option to deliver a service, but household resource recovery infrastructure planning, bodies and legislation in Victoria and recycling and collection is not mandatory overlap with SV’s role in statewide resource separates the responsibility of waste for councils. This presents practical barriers recovery infrastructure planning. This was collection and waste processing services to transparency and accountability, and identified by VAGO as a cause for confusion into different authorities. A similar approach funding of waste collection services. among stakeholders in the sector.67 In in Victoria could improve role clarity, Without clear roles and responsibilities addition, VAGO noted that the Metropolitan supporting greater consistency of service for local governments, it is difficult to WRRG (the biggest WRRG covering provision and better data collection, and measure their delivery over time. the greatest number of councils) does has the potential to address some of the not have enough funding to perform its market power imbalances currently seen Greater role clarity is likely to be a low- functions. Specifically, MRWWG’s remit in the sector by aggregating procurement cost fix with wide-ranging benefits to the was expanded to include C&I and of processing services. performance of the sector. This could be C&D waste, but MWRRG was not given achieved through either amendments to additional ongoing funding to support the Local Government Act 1989, or the these responsibilities. As such, MWRRG introduction of waste management- has reallocated funds internally to deliver specific legislation. a C&I strategy, which may hinder its ability to meet other core objectives.68 There are seven WRRGs across Victoria The WRRGs are responsible for developing The United Kingdom provides an Regional Waste and Resource Recovery international example of governance Infrastructure Plans (RWRRIPs), supporting frameworks that could be adopted local councils to procure waste and in Victoria to provide greater clarity. recycling services, infrastructure and service There, similarly to the EPA in Victoria, planning at a regional level, and educating the Environmental Agency acts as a 82 the community on waste avoidance and Data collection and reporting

The availability and use of timely and The data currently available is collected What we found accurate data will be key to improving through voluntary surveys of councils and Victoria’s recycling and resource waste reprocessing operators, which recovery. A clearer understanding means data is often inaccurate or of the volume and flows of materials incomplete.

will help both the Government and Infrastructure Victoria private sector plan and invest in VAGO noted that without regulatory infrastructure. This can ultimately or legislative requirements for councils strengthen the end markets for or operators to report data, or to monitor these materials and lead to greater the flow of materials segregated for recycling and re-use. recycling after these are sent to recovery or reprocessing facilities, it is difficult In 2011, VAGO found that a lack of for SV to resolve data limitations and data quality had affected the reliability these problems are likely to persist.71 of performance data and projected performance. VAGO recommended that SV develop a knowledge management system to rationalise data, and to identify 67 Victorian Auditor General’s Office (2019) Recovering and Reprocessing Resources from Waste and rectify data quality issues along with modelling accuracy. Better data collection 68 ibid. can help monitor improvements in 69 Victorian Auditor General’s Office (2011) Municipal Solid Waste Management performance.69 70 Victorian Auditor General’s Office (2019) Recovering and Reprocessing Resources from Waste In 2019, VAGO again noted that data quality issues limit the Government’s ability 71 Victorian Auditor General’s Office (2019) Recovering and Reprocessing Resources from Waste to understand how much waste is being generated and what happens to materials when they are recovered for recycling. This limits the Government’s ability to plan for, or invest in, infrastructure and to develop an overarching waste policy.70

83 The end markets for materials vary greatly

Advice on recycling and resource recovery Developing end markets for recycled The strength of end markets varies Effectively, investment in developing local materials is a challenge for countries by material type. Figure 25 provides markets for recycled products or high- all over the world. Even countries that an overview of the performance in quality products for export have been are considered best in the world for resource recovery across a range of limited. Fostering sustainable end markets recycling and resource recovery with indicators for key materials. for recyclable glass, plastic, paper and large manufacturing bases, such as organic materials can play a larger role South Korea, rely heavily on export There has been a significant focus in solving the stockpiling problems markets for some materials, particularly in Victoria on establishing infrastructure Victoria has recently experienced and plastic composites.72 to collect, sort, and to an extent, reprocess reducing the state’s reliance on landfill. recovered resources but the supply The lack of strong end markets for of recycled materials has not always Infrastructure Victoria recovered materials is stifling the been matched by demand. In many 72 AlphaBeta (2019) Recycling and resource recovery development of Victoria’s recycling and cases, there is limited market interest infrastructure in Victoria: International and Australian resource recovery sector. If recovered to establish significant, ongoing demand comparisons, report for Infrastructure Victoria materials are not valued by producers for products made from recycled or consumers, there is little to no incentive materials. for businesses to invest in processing infrastructure.

Figure 25: The opportunity for improved recovery and reprocessing in Victoria varies by material

Organics Plastics Packaging Paper and E-waste Masonry Metals Tyres Textiles glass cardboard

Tonnes of 2,489,166 586,282 344,093 1,997,800 83,445 5,222,935 1,590,409 69,537 190,411 material generated

Tonnes of 1,081,845 137,167 263,686 1,481,017 66,162 4,179,629 1,455,579 57,200 165 materials recovered

Proportion of total waste 19% 4% 3% 15% 1% 39% 12% 1% 1% generated

Recovery rate 43% 23% 77% 74% 79% 80% 92% 82% 0%

Proportion available in 35% 11%* 11%* 11%* 1% 0% 0% 0% 0% garbage bin

Proportion of waste 2% 15% 3% 32% 1% 0% 31% 43% 15% generated that is exported

Proportion of waste 4% 63% 4% 43% 1% 0% 34% 53% N/A 84 recovered that is exported

* 11% is the combined total of plastics, packaging glass and paper and cardboard Source: Blue Environment & Infrastructure Victoria analysis Markets are important

One challenge in developing end Another barrier is lack of awareness or requires approval of all individual waste What we found markets for recycled materials is concerns about the quality of recycled suppliers and digestate consumers, the cost of using recycled content products. Concerns about contamination which can be difficult to manage as in manufacturing. This is especially of materials, or insufficient information these change. Widespread adoption of true of plastics. Recycled plastics about the potential uses of recovered anaerobic digestion in the EU is supported

manufacturers operate in the same materials, can mean that consumers and by HACCP regulatory frameworks to ensure Infrastructure Victoria market as virgin plastics producers, producers are reluctant to buy products the resulting digestate is safe for use in and so must compete with virgin containing recycled content. This can agriculture. HACCP is widely used for food producers. The raw feedstocks be seen with plastics, due to concerns production in Australia. In addition, there for most plastics are fossil fuels, about the potential use of recycled plastics is uncertainty around the application of which are cheaper to use than in food packaging. carbon credits to anaerobic digestion, recycled materials. particularly where operators are obliged Multiple stakeholders have raised the to reduce carbon emissions through The reasons for the differences between importance of standards or certification regulation. Standards and specifications the cost of virgin and recycled materials of recycled materials with us. Creating should be reviewed and relaxed only are two-fold. First, the price of any product certification standards for products made where there is no risk of causing harm reflects the cost of making it. In the case from recycled content can address the to human health or the environment. of recycled materials, this includes the cost lack of information and certainty about of collecting, transporting, sorting and the quality of recycled products and provide A lack of demand for recycled material processing recovered materials to a point an indicator of quality. This can increase in production, regardless of costs, is also where they are a substitute for virgin the price of these products, making them a barrier to developing end markets for material, such as glass cullet, plastic more attractive to producers and ultimately recycled materials, particularly mixed pallets or resin, or pulp for paper and strengthening the end market for recycled materials. Producers want clean, single- cardboard. materials. stream materials. Recycling becomes far more complex when dealing with products Second, the price of virgin materials tends For example, the regulatory settings for that use composite materials. Composite not to include the full lifecycle costs of these the management of digestate – which is materials, which use multiple polymers products, such as the environmental impact the by-product from the anaerobic digestion can be difficult to separate during recycling. of extracting them or the costs of disposal, process – can be refined. The biggest For example, disposable coffee cups due to regulatory and market failures to regulatory issue raised by regional are predominantly made from paper, but ensure all these costs are reflected. stakeholders is how the digestate is an interior lining – commonly made of managed and its viability in agricultural use. polyethylene – make these cups very Most producers, seeking to minimise costs difficult to recycle. in production, will choose the lowest-cost For stakeholders running anaerobic input that serves their needs. Because digestion plants, the biggest issue was virgin materials can be cheaper, producers the current regulations. While the EPA’s are less likely to use recovered materials, current regulations do permit the use of limiting their market. digestate in agriculture, the approach 85 The Victorian Government can enable the use of recycled materials by changing design specifications and procurement standards.

Market development approaches

Enabling the use of products Since 2016, SV has awarded a total of Funding in recent years has been

Advice on recycling and resource recovery containing recycled materials supports $4.1 million in R&D grants to a total of spread across up to eight materials. the development of markets and 29 projects. These grants leverage funding Given the trial and error nature of research improves the sustainability and and in-kind contributions from industry and development, success cannot be resilience of the sector by providing and research partners. Small R&D projects guaranteed. A more ambitious program a pathway for materials. typically focus on one line of enquiry, with with a higher chance of commercialisation limited scope of lab testing of materials. could be pursued with the following Regulation and legislation can be both indicative contribution from the Victorian a barrier and an enabler, and these are Large R&D projects typically focus on two Government, and additional funding prime opportunities for government. to three lines of enquiry, with broader scope and in-kind support provided by the Victoria already performs well in this of lab testing of materials. Demonstration Commonwealth Government, industry regard – VicRoads is a national leader projects and field trials are the opportunity and academia. Infrastructure Victoria in the use of recycled products in pavement to prove performance in the real world construction – but we can do more. in a controlled manner with associated monitoring and evaluation to allow for Government can support demand for specifications to be changed and/or recycled materials by supporting research commercialisation to occur. and development to commercialise the use of recycled products, particularly packaging, manufacturing and agriculture. This provides an evidence base to give people confidence in using recycled products, and shows that recycled Figure 26: Market development for multiple materials products are fit for purpose. The Victorian takes considerable research and development Government can also provide a supportive environment for using recycled materials by either changing design specifications Material Small Large Field Total indicative R&D project R&D project trials R&D cost and procurement standards to encourage indicative cost indicative cost or mandate the use of recycled materials. Paper & cardboard $100,000 x 10 $200,000 x 10 $200,000 x 5 $4,000,000 Recycling Victoria – a new economy includes commitments to increase Plastics $100,000 x 10 $200,000 x 10 $200,000 x 5 $4,000,000 innovation, prioritise the use of recycled Glass $100,000 x 10 $200,000 x 10 $200,000 x 5 $4,000,000 materials in construction and to develop and promote standards, specifications and Organics $100,000 x 10 $200,000 x 10 $200,000 x 5 $4,000,000 guidance materials to increase the use Tyres $100,000 x 10 $200,000 x 10 $200,000 x 5 $4,000,000 of recycled materials. The Commonwealth Government has also made similar E-waste $100,000 x 10 $200,000 x 10 $200,000 x 5 $4,000,000 recent commitments. 86 Total $24,000,000 07.

What we heard from our stakeholders

Infrastructure Victoria is committed to consultation and creating recommendations through an open, evidence-based, transparent process. The consultation program for this advice included two main phases. The first phase ran from April to August 2019. We met with more than 150 individuals and organisations from across the waste sector, business and government, all of whom provided valuable input and helped us refine the scope of our research and analysis. A report that summarises the outcomes of this phase is available at infrastructurevictoria.com.au

Advice on recycling and resource recovery Throughout our work, we also regularly In our Evidence Base Report, we posed seven questions for response: consulted with a Sector Advisory Group which included people representing local 01. 05. government, the WRRGs, the waste Have we identified the right Where do you think government should management industry and broader industry. outcomes for Victoria to aim for? focus their efforts to increase recycling and resource recovery? (For example, through We released our Evidence Base Report setting targets, promoting consistency for consultation in October 2019. This 02. or funding local councils?) report discussed the findings of technical research we commissioned in developing Have we identified the most the evidence base. Consultation on the effective potential actions for

Infrastructure Victoria 06. Evidence Base Report was open from government to take? 13 October 2019 to 13 December 2019. Which materials or infrastructure types present the most opportunity 03. in your region? Which, if any, of the initiatives implemented in Wales would you like to see applied in Victoria? 07. What is a legislative barrier or enabler that you have encountered when 04. trying to use recycled materials? What do you think of the market design opportunities proposed to improve waste sector outcomes and efficiency?

We received 53 submissions from they relate to our final advice to the individuals, organisations, business Victorian Government is below. and local governments. The feedback Submissions are available in full at we received helped us understand infrastructurevictoria.com.au stakeholders’ priority issues and concerns and helped us refine our advice and The feedback we received from recommendations. stakeholders has provided highly valuable insights that have informed There were several key themes that our final advice. Infrastructure Victoria emerged in the feedback we received would like to thank everyone who 88 on the Evidence Base Report. A summary contributed to this work. of the most common issues and how Container Deposit Scheme (CDS) We found that without well-designed What we heard from our stakeholders product stewardship schemes there is The most commonly raised issue in the little incentive for consumers or producers submissions we received was the desire to consider the cost of waste. This is a for a CDS in Victoria. Victoria is the market failure, suggesting there is a role only jurisdiction in Australia that has not for government to intervene. We also introduced or announced it is planning found that the most successful product to introduce a CDS. stewardship schemes in high-performing Reasons for introducing a CDS in jurisdictions around the world are Victoria ranged from the potential to compulsory. There are a number of product reduce contamination of other materials stewardship schemes in place across Infrastructure Victoria streams in resource recovery to supporting Australia, but none are compulsory. stronger end markets for recycled glass Waste-to-energy and ensuring consistency across Australian jurisdictions. Some feedback we received The terms of reference for this advice asked suggested there should have been Infrastructure Victoria for advice on the more consideration given to a CDS infrastructure required for, and the role for in our Evidence Base Report. government in providing support to, a waste-to-energy sector that prioritises In this report, we included additional extracting recyclable material and recovers analysis of the costs and benefits energy only from residual waste. of a CDS, including research and consultation undertaken by the Victorian A number of stakeholders identified Parliamentary Inquiry into Recycling and waste-to-energy as a preferable to landfill, Waste Management. Our analysis of the which aligns with the waste hierarchy, evidence suggests that a CDS can improve but noted the importance of prioritising outcomes in recycling and resource avoidance, re-use and recovery. recovery as part of a broader suite Stakeholders also identified practical of initiatives. barriers to establishing waste-to-energy infrastructure in Victoria being the lack Product stewardship and of policy clarity around waste-to-energy extended producer responsibility in Victoria, the lack of an end market for The concept of product stewardship residual waste to energy by products, schemes received support from many and the role of the landfill levy in influencing stakeholders, particularly for hard-to-recycle the competitiveness of waste-to-energy. products like electronics or complex packaging. Our analysis supports this position. 89 Advice on recycling and resource recovery Landfill Levy Our analysis suggests that greater source Regional infrastructure separation leads to cleaner streams, which The Landfill Levy was identified as Regional stakeholders identified lack can improve resource recovery rates. At having potential for better use. Some of access to recycling services and the same time, a more consistent approach stakeholders suggested that, at a minimum, infrastructure as a barrier to resource to kerbside collections makes it easier the Victorian Government should consider recovery in regional areas. In some cases, for households to separate their waste making the Landfill Levy consistent geographic consolidation of infrastructure correctly and reduces contamination. with neighbouring states. Victoria has makes sense due to economies of scale. recently announced an increase to its Market development levy and is leading efforts for national In others, providing processing levy consistency under the National We heard that the Victorian Government infrastructure in regional areas can

Infrastructure Victoria Waste Policy Action Plan. has a role to play in supporting end markets reduce costs by eliminating or reducing for recycled materials. Without an end transport costs, leading to improved This work can consider the potential for market for recycled materials, the design recovery rates. Our analysis supports the Landfill Levy to be used to further of collection and processing systems this, particularly with materials that are support a transition toward a circular is irrelevant. sensitive to transport costs and gate fees, economy and alternatives to landfill, such as organics. Regional infrastructure such as waste-to-energy. This view aligns Government procurement can go some can also provide jobs in regional areas. with a point made by multiple stakeholders way to supporting an end market for who highlighted the need to reinvest more these materials by buying them directly. of the Landfill Levy with a specific focus The Government can also support their on infrastructure that supports a transition use in the broader economy by facilitating towards a circular economy. the development of standards and specifications for recycled products Collections (such as compost, digestate from anaerobic digestion, bottom ash from thermal Stakeholders commonly identified that waste-to-energy, and plastics in the approach to kerbside collections is construction or packaging applications). a barrier to improving resource recovery, particularly for MSW. We received Standards and certification can build feedback that improved source separation consumer confidence in these products, – particularly separating paper and supporting a market. Stakeholders cardboard from other co-mingled commonly identified the lack of confidence recyclables – and a more consistent in these products as a barrier. approach to collections across councils, could increase recovery rates. We agree.

90 08.

Methodology We developed our advice to the Victorian Government in three phases of stakeholder engagement and technical analysis. During the first phase of the project, which was completed in August 2019, we met with and heard from more than 150 organisations and individuals from across the waste sector, business, industry and government who provided valuable input and helped us refine the scope of our research and analysis.

Advice on recycling and resource recovery The second phase of the project was the Inter-jurisdictional analysis and recycling through policy, regulation, delivery of our Evidence Base Report in market design, support of new We commissioned an assessment October 2019. This report built on the infrastructure proposals and/or the of recycling and resource recovery outcomes of our stakeholder consultation potential to attract new operators practices, technologies and markets with detailed modelling and analysis, to Victoria to further develop the market. in other jurisdictions to understand the supported by international examples for potential for the Victorian Government comparison, including engagement with Materials flow analysis to adopt and adapt similar practices, key stakeholders in Wales and England. and sensitivity testing technologies and associated policies. This work presents a current benchmark Our technical work packages, summarised Sector mapping and market design of waste flows, material market values, below, consider the infrastructure, policy

Infrastructure Victoria value add opportunities and fates of and market settings for Victoria’s recycling We worked with the Centre for Market materials in the Victorian waste and and resource recovery sector. We Design at the University of Melbourne resource recovery sector. It identifies also compiled the most up-to-date to analyse the Victorian recycling and opportunities to increase recovery rates and comprehensive dataset for recycling resource recovery sector. This analysis and improve material outcomes to realise and resource recovery performance identified major decision or transaction a circular economy in Victoria. This analysis in Victoria to inform our analysis. points in the cycle, those involved at each shows where materials could go if subject point, where markets are missing or to improved processing or end market The final phase, the focus of this failing, and what the causes are. report, is to articulate the advice and development under a range of different recommendations for the Victorian We looked at the incentives influencing scenarios, reflecting different policy Government on the basis of the evidence each transaction including the availability settings. These policy settings represented we have gathered through our technical of information, the effect of regulation a refinement of the scenarios that were work, site visits to facilities across Victoria and the role of price, and applied market considered in our initial infrastructure and South Australia, and feedback we design principles to find approaches analysis. have received from stakeholders including to build resilience in the sector. Legislative and regulatory settings the Sector Advisory Group. We also Infrastructure analysis coordinated with a Government Advisory We examined the legislative and regulatory Group to ensure resource recovery The infrastructure analysis identifies and settings in place in the sector as well as and recycling work across government explores technologies and processes for any existing plans or strategies that are was shared. waste and resource recovery. It considers barriers or enablers to enhancing the sector the context for the planning, funding, in Victoria. This work was intended to The full versions of all technical construction and operation of infrastructure understand the authorising environment work undertaken to inform under different policy and investment for waste and resource recovery, such as this advice are available at scenarios. the barriers to using recycled materials in infrastructurevictoria.com.au a range of applications and the regulatory This enables us to understand the potential requirements for resource recovery facilities for the Victorian Government to adopt (including planning and land use settings). 92 specific approaches to resource recovery The final phase, the focus of this report, is to articulate the advice and recommendations for the Victorian Government on the basis on the evidence we have gathered through our technical work, site visits to facilities across Victoria and South Australia, and feedback we have received from stakeholders including the Sector Advisory Group.

Community polling market failures and complexities, and Methodology facilitate a well-functioning market that Using a representative sample of 1,000 will improve resource recovery. Victorian households, we undertook a quantitative online survey in July 2019 Infrastructure gap analysis to better understand community attitudes Infrastructure Victoria and perceptions on recycling and resource Building on our initial infrastructure analysis, recovery. The survey covered attitudes this work was undertaken to inform our and perceptions towards waste sorting understanding of the waste and resource practices, people’s willingness to change recovery infrastructure needs across their behaviour and perceptions of Victoria now and into the future, with product packaging. specific consideration of the needs of different regions and managing a range Community focus groups of different waste material.

We engaged Quantum Market Research This work informed our recommendations to develop a deeper understanding of how about what infrastructure will be required, Victorians’ attitudes and perceptions will and where, by analysing current waste influence the success of various potential and resource recovery infrastructure kerbside waste sorting and collection capacity and capability throughout Victoria initiatives. Focus group participants were and identifying gaps in future capacity engaged to help investigate levels of or capability. motivation amongst Victorians to adhere to new sorting and collection initiatives, Our analysis also considered the potential and the underlying factors that either impacts of Victorian and Australian motivated people or limited their adherence Government policy directions as well as to new rules and practices. priority materials for short-term effort to increase recycling capacity and capability. End market barriers and enablers

This work analysed the market for recycled and recovered materials and found that there are variety of market failures and complexities relating to the generation, collection and processing of waste, in addition to weak end markets for many recovered materials.

We identified specific policy levers that government can use to address these 93 Appendix A: Resource recovery infrastructure forecast investment by 2039

Advice on recycling and resource recovery Infrastructure Gap Analysis Overview Infrastructure Victoria developed a III. The opportunity to divert organics from methodology to guide its recommendations landfill, which comprises significant Infrastructure Victoria have undertaken for types of infrastructure needs and the tonnes that could be readily recovered an Infrastructure Gap Analysis to consider potential locations of infrastructure to for beneficial uses. the appropriate infrastructure facility types respond to current and emerging waste that will be required to manage current trends. To guide this, Infrastructure Victoria IV. The introduction of the Victorian e-waste and future resource recovery needs of commissioned Brock Baker Environmental landfill ban in July 2019 which requires Victoria considering: Consulting to undertake a ‘Waste and diversion of e-waste to resource recovery pathways. It is noted that \ projected waste generation Resource Recovery Infrastructure Data and e-waste is also heavily exposed to and resource recovery rates Spatial Analysis’ report and Blue Environment to develop a ‘Victorian Waste increasing international import Infrastructure Victoria \ the required capacity to manage Flows Projection’ model. These data sets restrictions as well. future waste tonnes informed Infrastructure Victoria’s gap Infrastructure Gap analysis. \ the required capability to transform Analysis Methodology recovered resources into valuable Priority materials Drawing upon this work, Infrastructure commodities Infrastructure Victoria has identified and Victoria’s methodology included analysis of: undertaken detailed analysis of six priority \ the potential suitable locations \ current and predicted waste generation waste material streams: E-waste, glass, for future infrastructure by material type organics, paper and cardboard, plastics, \ the indicative capital investment required and tyres. \ reprocessing capacity by material type

\ the indicative timing of when Infrastructure Victoria has identified these \ reprocessing capability by material type infrastructure will be required based as priority waste materials for analysis on current and emerging waste policies based on: \ location of resource recovery and market challenges. infrastructure and its proximity to end I. Their exposure to current market markets The recommended infrastructure challenges including international facilities are an estimated forecast import bans and fluctuating \ the Statewide Resource Recovery of what may be required in future years commodities prices. Infrastructure Plan (SWRRIP) and to respond to emerging waste and Regional Implementation Plans resource recovery trends. They are II. The potential impacts of the COAG not prescriptive and should be used waste export ban that seeks to restrict \ existing resource recovery hubs of for guiding purposes only. The complete the export of ‘scrap’ glass, paper and statewide significance as identified in Infrastructure Gap Analysis can be cardboard, plastics and tyres which will SWRRIP viewed as a Technical Document at be phased in from July 2020 and come \ stated government priorities to support into full effect by July 2024. www.infrastructurevictoria.com.au/ regional economies in transition e.g. 94 project/advice-on-waste-infrastructure- in the Latrobe Valley. in-victoria/ \ The ability to meet a range of policy and \ Recovery and reprocessing capability – Suburbs and towns are named as a Methodology resource recovery target scenarios by are based on both known and estimated locality guide only and are approximate. 2022, 2025, 2030 and 2039. These capabilities. include: – For example, where an organics \ Full businesses cases have not reprocessing facility is identified in

– The COAG Waste Export Ban proposal been developed. a township, the facility would have Infrastructure Victoria that seeks to restrict the export of to be located in an appropriately ‘scrap’ glass, paper and cardboard, \ Consultation with key stakeholders zoned area and would likely be on plastics and tyres which will be phased has not occurred. private land within the broader area in from July 2020 and come into full of any given township. \ Capital expenditure costs are based effect by July 2024. on industry estimates and comparable Infrastructure Gap Analysis – The APCO plastics recycling target recent investments in the waste and Recommendations of 70% of plastics to be recycled resource recovery sector. Infrastructure Victoria recommends in Australia by 2025. – Infrastructure has been costed at 2020 that there is an immediate and an ongoing – The National Waste Policy target costs. This has been extrapolated out need for investment in Victoria’s waste and of an 80% average resource recovery to 2039 based on 2020 costs alone. resource recovery network. Infrastructure rate from all waste streams following There has been no inclusion of NPV, Victoria estimates that by 2039: the waste hierarchy by 2030. discount rates, CPI, etc. \ Investment in approximately 87 – The Victorian e-waste landfill ban. – It is noted that over time, capital new or additional resource recovery investment for infrastructure will most infrastructure facilities will be required Infrastructure Gap likely increase. throughout Victoria. Analysis Key Assumptions \ Operating costs have been excluded \ An increase in total resource \ The results and recommended from this analysis. recovery infrastructure capacity infrastructure facility types are indicative of 3,157,500 tonnes is required. only. Technology choices and accepted \ Locations are indicative only and are feedstocks must be chosen at the based on assumptions around potential \ A forecast capital investment of discretion of any project proponent. site opportunities. between $800 million to $1.1 billion The Infrastructure Gap Analysis presents by 2039 will be needed to deliver the – Suburbs and towns have been data that can inform these decisions. required infrastructure. identified based on the aforementioned \ The Infrastructure Gap Analysis is methodology and are for illustrative based on responding to forecast waste purposes only. generation and resource recovery trends. – Any decisions on locations will need to \ Recovery and reprocessing capacity be made primarily by the private sector are based on both known and estimated and guided by appropriate land use capacities. planning and environmental approvals. 95 Advice on recycling and resource recovery Appropriate phasing of infrastructure \ paper and cardboard investment – To complement existing metropolitan investment, construction and between $157m to $198m to Melbourne e-waste reprocessing hubs. commissioning will be different for manage 2 million tonnes per annum each priority material. Specifically: – In Bendigo due to its proximity to \ plastics between $367.9m to $511.28m current and future deployment of \ By 2024 investment in recovery and to manage 515,000 tonnes per annum household, commercial and large-scale reprocessing infrastructure will be solar in central and northern Victoria. needed for paper and cardboard, \ tyres investment between $6m to $8m to meet the requirements of the to manage 15,000 tonnes of commingled – In both Geelong and Morwell to service COAG waste export ban. recycling per annum future end-of-life arisings in south west Victoria and Gippsland and to leverage

Infrastructure Victoria \ By 2025, investment in recovery \ new MRF investment between $12m existing infrastructure and labour forces and reprocessing infrastructure will to $20m to manage 80,000 tonnes where economic transition is occurring be needed for organics and plastics. of commingled recycling per annum. in Victoria.

\ By 2030, investment in recovery Infrastructure Facility – Outside Melbourne and the Geelong and reprocessing infrastructure Type Considerations region, the northern and eastern will be needed for e-waste. E-waste regions of Victoria have the highest density of solar PV installations. Both \ And by 2039, investment will be needed \ Infrastructure is recommended to Bendigo and Morwell can potentially in value-add recovery and reprocessing manage emerging waste streams serve as the reprocessing hubs for infrastructure for glass and tyres. of high hazard and high value. these regions.

To manage total forecast resource recovery \ Reprocessing locations for e-waste Glass trends by 2039, it is estimated that future products including batteries, televisions, resource recovery investment required by computers, monitors and peripherals \ Infrastructure is recommended to 2039 will include: have been recommended in existing manage future glass recovery with a metropolitan Melbourne hubs. view to increasing capacity and capability \ e-waste investment between $12m to to process glass into glass sand products $55m to manage 34,500 tonnes per Solar photovoltaic (PV) panel reprocessing for use in sand replacement applications, annum has been recommended: crushed rock and aggregate blends, and abrasives. \ glass investment between $17.5m – To account for installation of solar to $24.3m to manage 328,000 tonnes PV panel uptake and density \ In particular, glass sand and aggregate per annum throughout Victoria based on data infrastructure is recommended to be from the Clean Energy Regulator deployed throughout regional Victoria to \ organics investment between and mapping by the Australian PV realise the potential for use in local road $229.75m to $317.32m to manage Institute (https://pv-map.apvi.org.au/ and infrastructure construction activities 805,000 tonnes per annum historical#7/-36.545/144. 316). to manage future end-of-life arisings and 96 support local circular economic activity. \ One additional glass beneficiation plant are recommended for hubs identified and urban amenity issues. Methodology has been recommended due to the recent in the SWRRIP in Melbourne’s western decrease in capacity following the January (Laverton North) and northern (Epping) \ Open windrow composting has been 2020 closure of the GRS beneficiation suburbs. recommended in regional Victorian facility in Coolaroo. However, Infrastructure locations that are potentially more likely Infrastructure Victoria Victoria cautions that any investment – Due to the challenges in meeting EPA to manage EPA requirements, social in additional glass beneficiation should requirements and managing social licence and urban amenity issues. consider both current and long-term licence to operate, it is unlikely that any Paper and cardboard market demand for glass cullet for use future significant organics reprocessing will occur in metropolitan Melbourne. in Victorian glass packaging production. \ Pulp mills have been recommended following the COAG export ban to Organics – To meet the increasing FOGO service demands, and to meet Melbourne’s manage the shortfall in both capacity \ Anaerobic digestion has been identified growing population and traffic and capability to meet these new as a suitable technology to manage congestion, Infrastructure Victoria requirement and/or domestic production current and future commercial food recommends that SMRCs are requirements. However it must be noted organics recovery. constructed to provide opportunities that such infrastructure is expensive to consolidate and aggregate FOGO and based on current paper markets, – The north of Melbourne is already prior to transportation, enabling the entrance of any new stakeholders serviced in Wollert, servicing key transport efficiencies to be realised is considered to be unlikely. Therefore, clients such as the Melbourne Market and haul FOGO to regional Victorian any new pulp mills would likely need to (wholesale fruit and vegetables). reprocessing facilities. complement existing market players.

– There are still significant opportunities – Laverton North is approximately \ There is an opportunity for niche to service food production businesses 50km from the Barwon South West and bespoke paper and cardboard in Melbourne’s south east (Dandenong region and approximately 100km products to be produced to meet South) and in Victoria’s Goulburn from the Central West region. Epping shifting consumer sentiment and Valley (Girgarre). is approximately 30km from the corporate shifts away from single southern end of the Goulburn Valley use plastics in packaging. – Other locations throughout Victoria may region and approximately 125km also be viable and further investigation \ Additional paper separation technology from the Central West region. of suitable location is recommended upgrades at MRFs are recommended – Melbourne’s south east is presently to meet the COAG waste export ban \ As Melbourne councils introduce further well serviced. requirements. FOGO services, the existing capacity to consolidate and reprocess organics \ In-vessel composting has been \ Further C&I paper recovery facilities into compost will be insufficient. recommended in areas close to are also recommended to meet the large regional centres to manage COAG waste export ban requirements. – Dedicated Special Materials Recovery EPA requirements, social licence Centres (transfer stations for organics) 97 Plastics Tyres Figure 27: Resource recovery infrastructure forecast investment Advice on recycling and resource recovery \ Further investment is required in plastics \ No further tyre reprocessing to by 2039 reprocessing infrastructure including to shred tyres is required in Victoria mechanically shred, wash, granulate, to meet current domestic and export flake by single polymer type or pelletise market demands. by single polymer type. \ However, should there be interest \ Victoria potentially has significant in building domestic demand for competitive advantage and existing Tyre Derived Products from passenger Note: Locations are indicative only based on Infrastructure plastics manufacturing infrastructure tyres, then there is an opportunity Victoria methodology. In some instances facilities are likely to that could be leveraged to manage for investment in increased fibre be outside of the identified town centres in a neighbouring area. Capex costs are based on 2020 cost estimates only. Tonnes this challenge. Victoria is currently separation infrastructure. per annum are based on Waste Data Flows analysis. Number of facilities to manage projected TPA may be scaled up or down Infrastructure Victoria home to two major plastics resins based on facility size design. Proposed scale is indicative only. manufacturing businesses. \ It is recommended that such infrastructure be located in Melbourne’s northern – Qenos has resins manufacturing suburbs where Victoria’s two major tyre production operations in NSW and reprocessing businesses are located. in Altona, Victoria. Qenos is the sole manufacturer of polyethylene MRFs in Australia. \ Generally, Victorian MRF infrastructure – LyondellBasell has resins manufacturing will need upgrading to increase the ability production operations in NSW and to sort and separate mixed materials. Geelong, Victoria. LyondellBasell is Presently, MRFs typically produce bales the sole manufacturer of polypropylene of mixed materials including paper in Australia. and plastics. The market demand and in some cases, market authorisation, – The presence of these two major is seeing limited outlets for mixed resins manufacturers in Victoria, baled materials. Further investment with considerable market access, will be required in infrastructure to represents a significant opportunity present sorted, clean streams of to use recovered plastics in resins recovered materials. manufacturing in Australia. \ Beyond this, there are notable gaps in \ Investment in both metropolitan the provision of MRF infrastructure in Melbourne and regional Victoria Victoria’s south west and central western would be appropriate. Regional Victoria regions. Infrastructure Victoria sees has historically proven to be suitable opportunities for new MRF infrastructure for the reprocessing of plastics and to be located in Geelong and Ballarat there are opportunities for regional to service these Victorian regions. 98 flaking and pelletising infrastructure. Infrastructure Victoria Recycling and Resource Recovery Infrastructure Facility Recommendations 2020 to 2039

No. of Capacity Supply Material Facility type facilities (Tonnes per Low capex High capex Indicative location chain role type 2039 annum) 2039 Mixed MRF – Mechanical separation 2 80,000 $12,000,000 $20,000,000 Ballarat, and optical sorting Geelong

Organics SMRC – Transfer stations 2 240,000 $18,000,000 $36,000,000 Epping, dedicated to organics with Laverton North hard stand, cover, bays

Paper MRF – Paper separation 11 440,000 $16,500,000 $33,000,000 Bendigo, Coolaroo, upgrades Dandenong South, Echuca,

Recovery Heidelberg, Laverton North, Lucknow, Morwell, Springvale, Truganina, Wangaratta

Paper SMRC – C&I paper recovery 6 300,000 $51,000,000 $60,000,000 Ballarat, Coolaroo, Dandenong South, Geelong, Laverton North, Truganina

E-waste Manual disassembly & 2 4,000 $1,750,000 $2,200,100 Dandenong South mechanical processing – Batteries

E-waste Solar photovoltaic 5 25,000 $7,500,000 $50,000,000 Bendigo, Dandenong South,

panel reprocessing Geelong, Laverton North, Methodology Morwell

Glass Beneficiation plant 1 108,000 $8,100,000 $13,338,000 Laverton North

Glass Sand/aggregate plant – Large 2 100,000 $4,250,000 $5,000,000 Clayton South

Glass Sand/aggregate plant – Small 12 120,000 $5,160,000 $6,000,000 Bairnsdale, Ballarat, Bendigo, Echuca, Mildura, Morwell, Infrastructure Victoria North Geelong, Wangaratta, Warrnambool, Wodonga

Organics Anaerobic digestion 2 60,000 $15,000,000 $48,000,000 Dandenong South, Girgarre

Organics In-vessel composting – 4 250,000 $137,500,000 $161,250,000 Ballarat, North Geelong large & medium

Organics In-vessel composting – medium 3 75,000 $41,250,000 $46,875,000 Mansfield, Morwell, Warrnambool

Organics Open Windrow composting 6 180,000 $18,000,000 $25,200,000 Bairnsdale, Bendigo, Mildura, Swan Hill, Wallan

Paper & Other e.g. food fibre packaging 4 40,000 $6,000,000 $7,000,000 Dandenong South, cardboard and tissue, paper towel Laverton North Reprocessing Paper & Pulp mill 2 600,000 $90,000,000 $105,000,000 Dandenong South, cardboard Laverton North

Plastics Chemical processing 1 20,000 $34,000,000 $40,000,000 Dandenong South

Plastics Chemical processing & flaking & 2 70,000 $67,350,000 $90,000,000 Altona pelletising plant (food grade)

Plastics Chemical processing, pelletising 4 145,000 $104,850,000 $143,760,000 Geelong plant, flaking & pelletising plant (food grade & non-food grade)

Plastics Flaking & pelletising plant – Small 8 80,000 $53,360,000 $80,000,000 Bairnsdale, Bendigo, Mildura, Morwell, Shepparton, Warrnambool, Wodonga

Plastics Flaking & pelletising plant (food 2 100,000 $45,850,000 $64,285,000 Ballarat grade & non-food grade)

Plastics Pelletising plant 1 25,000 $25,000,000 $39,475,000 Laverton North

Plastics Pelletising plant & flaking, 2 75,000 $37,500,000 $53,760,000 Campbellfield pelletising plant (non-food grade)

Tyres Fibre separation plant 1 15,000 $6,000,000 $8,025,000 Somerton

Total number of facilities and total capex 87 3,157,500 $808,695,000 $1,141,543,200

Infrastructure has been costed at 2020 costs. This has been extrapolated out to 2039 based on 2020 costs alone. There has been no inclusion of NPV, discount rates, CPI etc. 99 Appendix B: Defined terms Advice on recycling and resource recovery Term Definition

%RR Percentage recovery rate

ACCU Australian Carbon Credit Unit

APCO Australian Packaging Covenant Organisation

C&D Construction and Demolition Waste

C&I Commercial and Industrial Waste

Infrastructure Victoria CDS Container Deposit Scheme

CEFC Clean Energy Finance Corporation

COAG Council of Australian Governments

DELWP Department of Environment, Land, Water and Planning

E-waste In Victoria, e-waste (electronic waste) refers to any item with a plug, battery or cord that is no longer working or wanted

EP Act Environment Protection Act (both the Environment Protection Act 1970 and Environment Protection Act 2017)

EPA Environmental Protection Authority Victoria

EPR Extended Producer Responsibility

EU European Union

FOGO Mixed Food Organics and Garden Organics

HACCP Hazard Analysis and Critical Control Point

HDPE High-density polyethylene (type of plastic)

MRF Material Recovery Facility

MSW Municipal Solid Waste

NTCRS National Television and Computer Recycling Scheme

PBO Victorian Parliamentary Budget Office 100 Methodology Term Definition

PET Polyethylene terephthalate (type of plastic)

Pyrolysis A thermal process for separating materials without oxygen Infrastructure Victoria

PVs Solar photovoltaic panels

R&D Research and Development

VRIP Victorian Recycling Infrastructure Plan

SMRC Specific Materials Recovery Centre

SV Sustainability Victoria

SWRRIP Statewide Waste and Resource Recovery Infrastructure Plan, now referred to as the Recycling Infrastructure Plan (RIP)

VAGO Victorian Government Auditor General Office

WEEE Waste Electrical and Electronic Equipment Directive

WRRGs Waste and Resource Recovery Groups

101 Sources Image credits

Advice on recycling and resource recovery 7 News (2019) Class action win for residents affected by Infrastructure Victoria (2018) Advice on Automated Pages 14, 22 (top), 40, 45, 65, Coolaroo recycling plant fire, Available at https://7news.com.au/ and Zero Emissions Vehicles Infrastructure news/court-justice/class-action-win-for-residents-affected- 67, 72 and 83: (C) Sustainability Victoria by-coolaroo-recycling-plant-fire-c-378097, accessed on Infrastructure Victoria (2019) Evidence Base Report: 7 October 2019 Recycling and resource recovery infrastructure Page 77: DELWP Image Library (C) 2020 Access Economics (2009) Employment in waste management Infrastructure Victoria (2019) Legislative and regulatory review and recycling, report for the Department of the Environment, Infrastructure Victoria (2020) Resource Recovery Infrastructure Water, Heritage and the Arts Gap Analysis AlphaBeta (2019) Recycling and resource recovery Office of Resource Recovery, Department of Environment and infrastructure in Victoria: International and Australian Science (2019) Energy from Waste Policy – Discussion paper comparisons, report for Infrastructure Victoria for consultation Blue Environment (2019) Victorian Waste flows projections, Parliament of Victoria Legislative Council Environment report for Infrastructure Victoria and Planning Committee (2019) Inquiry into recycling

Infrastructure Victoria Brock Baker Environmental Consulting (2020) Waste and waste management – final report and Resource Recovery Infrastructure Data and Spatial Plott, Charles R. and Lee, Hsing-Yang and Maron, Analysis, report for Infrastructure Victoria Travis (2014). The Continuous Combinatorial Auction Centre for Market Design (2019) Opportunities to improve Architecture, American Economic Review infrastructure investment in the Victorian waste economy, Quantum Market Research (2019) Kerbside Collection report for Infrastructure Victoria Deep Dive, report for Infrastructure Victoria Clean Energy Finance Corporation (2016) Energy from Quantum Market Research (2019) Waste Advice Research, waste in Australia: a state-by-state update report for Infrastructure Victoria Crampton, P. (2001) Handbook of Telecommunications Stoneham et al (2002) Auctions for Conservation Contracts: Economics, Martin Cave, Sumit Majumdar, and Ingo An Empirical Examination of Victoria’s Bush Tender Trial Vogelsang, eds., Amsterdam: Elsevier Science B.V. Australian Journal of Agricultural and Resource Economics Deloitte (2019) Regulatory Impact Statement: Proposed Sustainability Victoria (2014) Victorian Statewide Garbage environment protection regulations, report for the Bin Audit 2013 Department of Environment, Land, Water and Planning and the Environment Protection Authority Sustainability Victoria (2019) Victorian Local Government Annual Waste Services Report 2017-18 Department of Environment, Land, Water and Planning (2017) Turning waste into energy, Join the discussion Victorian Auditor General’s Office (2011) Municipal Solid Waste Management, Department of Environment, Land, Water and Planning (2018) Management and storage of combustible recyclable Victorian Auditor-General’s Office (2019) Recovering and and waste material, Policy Impact Assessment Reprocessing Resources from Waste

Department of Environment, Land, Water and Planning (2019) A circular economy for Victoria – Creating more value and less waste

Department of Environment, Land, Water and Planning (2020) Recycling Victoria: A new economy

Department of Treasury and Finance (2019) Victorian Budget 19/20 – Budget Paper No. 3

102 List of figures

Figure 1 Figure 12 Figure 22 Methodology Recycling and resource recovery Organics processing shortfall Most processing occurs in infrastructure outcomes is expected by 2025 Melbourne; except for organics

Figure 2 Figure 13 Figure 23 Infrastructure Victoria Preferred waste outcomes End-of-life paper and cardboard Indicative location of required recovery volumes are expected to increase and reprocessing infrastructure Figure 3 Recovery of household and commercial Figure 14 Figure 24 waste is low, and is an opportunity Paper and cardboard processing Bin lid colours are inconsistent shortfall is immediate across Melbourne Figure 4 Some materials are more Figure 15 Figure 25 problematic than others End-of-life tyres are expected The opportunity for improved to increase by 2039 recovery and reprocessing in Figure 5 Victoria varies by material Resource recovery infrastructure Figure 16 comes in many different forms Tyre processing capacity is sufficient Figure 26 Market development for multiple Figure 6 Figure 17 materials takes considerable research Reprocessing capacity varies by material E-waste is projected to grow and development

Figure 7 Figure 18 Figure 27 End-of-life plastic generation is E-waste processing shortfall Resource recovery infrastructure expected to grow in Victoria is expected by 2030 forecast investment by 2039

Figure 8 Figure 19 Plastics processing shortfall is Estimated value of recovered expected by 2025 materials in 2019 – Victorian prices / South Australian prices Figure 9 End-of-life glass generation Figure 20 will grow by 2039 The Victorian recycling industry has the potential to generate up Figure 10 to 5,000 new jobs by 2039 Glass processing is sufficient Figure 21 Figure 11 Reprocessing infrastructure is highly More organic waste is expected over time concentrated around Melbourne 103 This publication may be of assistance to you, but Infrastructure Victoria and its employees do not guarantee that the publication is without flaw of any kind or is wholly appropriate for your particular purposes and therefore disclaims all liability for any error, loss or other consequence that may arise from you relying on any information in this publication. You should seek appropriately qualified advice before making any decisions regarding your particular project.

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