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City of Ballarat Submission to the Advice on Waste Infrastructure in Victoria

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City of Ballarat Submission to the Advice on Waste Infrastructure in Victoria DocuSign Envelope ID: D9AC3D64-D706-4D39-8678-DA4FE0FF4DA9 PO Box 655 Telephone: 03 5320 5500 Ballarat Vic 3353 Facsimile: 03 5333 4061 AUSTRALIA Date: 28 June 2019 Our Ref: Infrastructure Victoria Your Ref: Level 33, 140 William Street Melbourne Enquiries: (03) 5320 5731 VIC 3000 Direct Email: [email protected] Dear Sir/Madam RE: CITY OF BALLARAT SUBMISSION TO THE ADVICE ON WASTE INFRASTRUCTURE IN VICTORIA City of Ballarat continues to pursue its ambition to be a national leader in the circular economy, with plans for an improved, value added approach to recycling. Council has long been proactive in waste management and energy security and welcomes the opportunity to provide a submission to the Advice on Waste Infrastructure in Victoria consultative process. Council recently undertook a comprehensive review of its Ballarat Regional (Smythesdale) Landfill operation. Current trends in waste generation and population growth in Ballarat are rapidly depleting the capacity at the Ballarat Regional (Smythesdale) Landfill. It is expected to reach capacity by 2043, denying the City of Ballarat and western Victoria a strategic asset that is required for the long term. The recycling challenges we are facing will not change in the short term. Ballarat is ready to respond to the challenge and will continue to lobby governments to convince them of the urgency of investing in Regional Victoria, allowing cities like ours to move toward genuine regional solutions to process recycling and develop markets for the resultant product. City of Ballarat has identified the following key issues and underlying factors that are affecting the waste industry in Victoria. A fragile outsourced recycling system is undermining community confidence in recycling. The recycling crisis exposed a lack of system flexibility and resilience, resulting from a deficiency of significant investment in a network of advanced resource recovery infrastructure such as high-tech Materials Recovery Facilities (MRF’s). This is a view consistent with the Municipal Association Victoria (MAV) and Victorian Auditor General Office. The MAV in their submission to Parliamentary Inquiry to the Recycling Industry highlighted that $1.7 billion has been collected through EPA levy monies since 2005, and at 30 June 2018 only $80 million of the funds went into the Sustainability Fund. In 2018 the VAGO report Managing the Municipal and Industrial Levy concluded there was risk that the EPA levy and Sustainability fund monies are not always used for intended purpose, and therefore not achieving the legislative objectives. Current MRF infrastructure are relatively old and outdated technology, often outputting mixed bale commodities (e.g. mixed paper/cardboard, mixed plastics). The market for these mixed and relatively contaminated commodities has collapsed as they cannot meet stringent quality DocuSign Envelope ID: D9AC3D64-D706-4D39-8678-DA4FE0FF4DA9 measures. It is important to note that value remains in commodities with additional categorical sort, quality infrastructure and operational processes. A key issue faced by MRF operators is broken glass contaminating sorted product streams, no matter how advanced the MRF infrastructure. This was a key issue experienced when Council implemented a temporary MRF during the recycling crisis and has been reiterated through subsequent discussion with MRF operators and pilot projects have commenced in Melbourne with separate kerbside glass collection. A significant factor for regional areas is transport costs, consisting of transport costs from kerbside to MRF and subsequent transport costs of commodities to end markets. These efficiency losses are ultimately passed on as an increase in waste management costs to Councils and their ratepayers. There is a current lack of competition in Victorian recycling processing, with a duopoly in MRF operation by SKM and Visy. There is no incentive for commercial operators to progress innovation within the industry as downturns in the product markets are ultimately passed onto their customers rather than the MRF operators investing over time bettering their processes to adapt. Community education about appropriate waste sorting is poor resulting in approximately 16% contamination in kerbside recycling bins in Victoria. In addition to this, a recent bin audit in Ballarat identified more than 15% of material in general waste bins were recyclable materials during that survey period (note: survey was pre-crisis), which is a potential loss of more than 4,000 tonnes of common recyclables to landfill per year. Depleting landfill capacity in Victoria At current rate of consumption and population growth, and in the absence of significant investment in diversion, Victoria would require additional landfill air-space to the equivalent volume of two more Melbourne Regional Landfill within the next 30 years. The rate of declining landfill air-space is accelerated unnecessarily from large volumes of divertible municipal waste and divertible commercial waste entering landfill. This has been driven by a lack of significant investment in resource recovery infrastructure to maximise diversion. Within the waste industry, there is a conflict of interest between the diversion of waste from landfill, and subsequent loss of income. For commercial landfills especially, there is no incentive to facilitate diversion from landfill as income to manage compliance requirements and future post closure management costs is needed. Low levels of resource recovery from Commercial and Industrial sources. Commercial and Industrial (C&I) waste often occupies a significant portion of the material entering landfill. This is almost 50% at Ballarat Regional (Smythesdale) Landfill operated by City of Ballarat. Waste audits at this landfill from 2015 to present reveal a significant amount of recoverable material, particularly food, timber and metals in the C&I sector. C&I recycling facilities don’t seem to be as common as Construction and Demolition (C&D) facilities, yet the City of Ballarat in recent site visits have seen examples in the Victorian waste industry of C&I facilities operating successfully. We don’t understand why C&I facilities don’t seem to be as common and research needs to be undertaken to identify the underlying constraints. Immature and limited markets for remanufacturing The end markets for remanufacturing are still developing and the lack of viable market opportunities are limiting growth in the circular economy industry and jobs. In order to assess the viability of potential and emerging markets there needs to be greater data sharing across public and private sector to better understand regional-scale materials movement and aggregation potential. The recent VAGO report Recovering and Reprocessing Resources from Waste (6 June 2019) highlighted many issues with data consistency and accessibility. There has been a lack of research and development into new remanufacturing industries with scalable and enduring potential. Whilst we applaud funding announcements in R&D DocuSign Envelope ID: D9AC3D64-D706-4D39-8678-DA4FE0FF4DA9 since release of the Recycling Industry Strategic Plan (RISP) in 2018, we reiterate that the scale of investment of EPA levy monies back into the industry does not match the scale of intervention required. We look forward to substantial increase in funding avenues that stem from recommendations through this inquiry and the recent Victorian Parliament Environment and Planning Committee’s inquiry into recycling and waste management. The development of new markets could also be assisted by providing greater resourcing to the Australia Packaging Covenant Organisation (APCO), aiming to achieve more consistency in products that can be recycled with minimal fuss. Advocacy by APCO and others is also required to address the issue of cheap imports that undermine market viability of local remanufacturing. Land acquisition costs are likely to be another key barrier to the business case for new remanufacturing operations. Recent work by Council has identified substantial land acquisition costs for remanufacturing businesses looking to locate close to the planned All Waste Interchange and Materials Recovery Facility (AWI) in the Ballarat West Employment Zone (BWEZ). In this instance, there is an opportunity for State Government to facilitate through co-investment the establishment of reprocessing/remanufacturing businesses with proven and enduring potential to establish in BWEZ. Waste to Energy Waste to energy technology has an important role to play in the management of waste in Victoria, particularly the portion of waste that does not have the potential to be reused or recycled. Investment in waste to energy technology would provide an alternative to dispose of waste that would otherwise be destined to landfill, increasing the lifespan of existing landfills and allowing for energy recovery from this waste. The lack of investment in large scale waste to energy facilities in Victoria is in part due to the lack of a Waste to Energy policy, which would provide guidance and increased certainty to government agencies, local government and investors. The industry is also eagerly awaiting the release of the Circular Economy policy sometime in 2020. Ballarat – the waste management solution for western Victoria City of Ballarat is ready to respond to the waste management challenge and is a prime opportunity for State investment as one of the key solutions for western Victoria. The All Waste Interchange (AWI) will maximise
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