Final Report Regional Market Assessment for Wood Waste for North East England

Project code: RED002001 ISBN:1-84405-369-5 Research date: Date: March 2007

Regional Market Assessment for Wood Waste for North East England 2

WRAP works in partnership to encourage and enable businesses and consumers to be more efficient in their use of materials and recycle more things more often. This helps to minimise landfill, reduce carbon emissions and improve our environment.

Written by: ESYS Consulting Limited

Front cover photography: Different sized pieces of wood from a construction site.

WRAP and ESYS Consulting Limited believe the content of this report to be correct as at the date of writing. However, factors such as prices, levels of recycled content and regulatory requirements are subject to change and users of the report should check with their suppliers to confirm the current situation. In addition, care should be taken in using any of the cost information provided as it is based upon numerous project-specific assumptions (such as scale, location, tender context, etc.). The report does not claim to be exhaustive, nor does it claim to cover all relevant products and specifications available on the market. While steps have been taken to ensure accuracy, WRAP cannot accept responsibility or be held liable to any person for any loss or damage arising out of or in connection with this information being inaccurate, incomplete or misleading. It is the responsibility of the potential user of a material or product to consult with the supplier or manufacturer and ascertain whether a particular product will satisfy their specific requirements. The listing or featuring of a particular product or company does not constitute an endorsement by WRAP and WRAP cannot guarantee the performance of individual products or materials. For more detail, please refer to WRAP’s Terms & Conditions on its web site: www.wrap.org.uk

Executive summary

INTRODUCTION & STUDY OBJECTIVES

Following on from publication in 2006 of the “Regional Supply Chain and Recyclate Market Development Plan for the North East Region”, this study looks in greater detail at the wood recycling market in the region. The report was commissioned by WRAP to support ONE NorthEast in considering what interventions they could make in supporting growth in the supply chain. Waste wood is of particular interest in the region due to a number of high profile developments, including UK Wood Recycling Limited in Teesside; Egger (UK) Ltd’s new plant and WID compliant boiler in Hexham, which will increase the volume of waste wood utilised by the company considerably; and recent research which has warned of supply shortages in the wider region of virgin timber and saw mill co-products, thus increasing the potential demand for waste wood.

The key objectives of this study are to: „ Investigate the current regional supply chain for the wood recycling and biomass sectors; „ Review overall demand for waste wood; „ Assess opportunities for and the barriers to expansion in the regional wood recycling market.

There are EU and UK legislative drivers affecting both the supply and demand sides of the wood recycling and recovery sector, including the Packaging and Landfill directives, the Climate Change Levy and Renewables Obligation and the Waste Incineration Directive (WID). It is the intention of legislation to maintain the waste hierarchy – reduce; reuse; recycle; recover (refer to page 17, Definitions) in that order – but in practice there are fears amongst industries utilising wood recyclate that the energy sector could swallow up waste wood which could be reused/recycled.

Grades of waste wood may be summarised as follows: 1) Clean recycled waste wood; 2) Panelboard grade (a mix of grade 1 and mixed grade wood); 3) Fuel grade; and, 4) Hazardous grade. Details of the types of wood waste falling in to each of these categories are given in the body of this report.

THE REGIONAL ECONOMY

The North East is the smallest of the English regions in both area (8,592 square km) and population (2.6 million, 5% of England’s population). It is largely rural but also contains the urban conurbations of Newcastle, Gateshead, Sunderland and Washington around the river Tyne. The region is administered by 2 county, 13 district and 10 unitary authorities across 4 sub regions.

The North East is the poorest of all of the English regions with an economic output 40% below that of London. With two-thirds of the region being rural, the performance of the rural economy is very important. Earnings in the region are 87% of the English average and GVA per head is 77% of the English average. As such the region has benefited from European Objective 2 and 3 regeneration and social funding and has UK DTI ‘assisted area’ status for Teesside.

Economic restructuring in the 1970s and 1980s saw a decline in the manufacturing sector within the region. The most significant sectors in the region now are the Public Sector (32% of employment), Distribution & Leisure (22%), Finance (16%) and then Manufacturing (12%).

In economic terms, the wood-based industries sector is important to the region – representing around 3% of the region’s manufacturing jobs and 5.6% of England’s wood manufacturing jobs. The 3,700 regional jobs in saw milling and wood based manufacturing industries can be estimated to contribute around £50 million to regional Gross Value Added (GVA), based on the regional average GVA per head of £13,524 in 2004. Salaries from the sector amount to some £62 million per annum (based on median gross weekly wages in the region of £322).

The wood reprocessing sector in the region has four main employers: Egger (UK) Ltd at Hexham, UK Wood Recycling Ltd at Wilton, Wood Pellet Energy UK Ltd in County Durham and Reivers Reprocessing Ltd in Gateshead.

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There are other wood reprocessing operators, although these tend to be waste management and collection companies who process wood as part of a wider operation.

The impacts on the regional economy of dedicated wood reprocessing employment can be summarised as follows:

Current Within 3 to 5 Years Employment numbers in the North East 33 73 Annual GVA @ £13,524 per head (at 2004 values) £446 thousand £987 thousand Annual Gross Income @ £322/week (2006 median) £553 thousand £1,222 thousand

WOOD WASTE ARISINGS

Chapter 3 analyses the best available information on wood waste arisings in the region. These may be categorised as municipal, commercial and industrial (C&I), construction and demolition (C&D), agricultural and arboricultural waste wood arisings.

Defra municipal waste arisings data for 2005/2006 are available by local authority, waste collection route, material category and waste disposal route. As wood waste is not separated, we supplemented the information provided by interviewing the regional local authorities and the waste management companies involved in municipal collections. The main sources for municipal wood waste are via Household Waste and Recycling Centres (HWRCs) and bulky waste collections.

The latest official data for C&I arisings is the Environment Agency’s 2002/2003 C&I Waste Survey data. However, we were able to enhance this data with as yet unpublished Environment Agency data for 2004 C&I waste in the region and the findings from various research reports.

The latest available C&D waste data relates to 2004 and was compiled by Capita Symonds, but is available via the Environment Agency’s website. This data was supported by several recent research reports.

Agricultural wood waste is mainly old fencing and posts. However, this is mainly used on site and does not actually enter the waste stream.

There has been much debate about the volume of arboricultural arisings (tree surgery and forestry wastes) which are available for fuel recovery. ‘Gut feel’ estimates from Northwoods (a regional delivery partner) put the figure at around 100,000 tonnes per annum. However, this figure has not been scientifically supported and such arisings are currently being used on site or elsewhere within local authorities at zero disposal cost. Although there is an argument that Local Authorities could possibly gain positive economic value from their arboricultural arisings, this would not actually be diverting waste from landfill.

The table below summarises the best current estimates of wood waste arisings in the region and their disposal routes:

Summary of Best Estimates of Wood Waste Arisings in the North East Reprocessed/ Arisings Recovered Landfill Other Municipal 77,000 16% 27,200 49,800 Commercial & Industrial 145,000 31% 39-64,000 81-106,000 Construction & Demolition 246,000 53% 50,000 196,000 Sub-total: 468,000 116-141,200 327-352,000 Arboricultural 100,000 - - 100,000 Agricultural Negligible 568,000 116-141,200 327-352,000 100,000 Source: ESYS

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NORTH EAST WASTE WOOD REPROCESSING

Egger (UK) Limited has a panel board manufacturing plant in Hexham. In addition to being one of the largest consumers of waste wood in the region, Egger is itself a major reprocessor. They are the only UK panel board manufacturer with their own full recycling plant.

Egger Hexham sources its waste wood via a number of channels: its own wood recycling business, Timberpak based in Leeds; a network of thirteen Wood Collectors/Recyclers (from the M4 corridor to Edinburgh); and a little material is delivered direct to Hexham for reprocessing.

A brand new conti-board production line will go live in April 2007. This replaces two older lines and increases the company’s waste wood capacity considerably. One of the major improvements of the new plant will be a fully WID-compliant boiler. This will be fuelled by the plant’s waste materials (bark from roundwood inputs, wood fines and sanding dust) giving them a double benefit of an outlet for their fines and the ability to produce process heat for free.

There are no current plans to diversify in to other higher value recycled wood products at the plant. Any excess material is sold on to other panel board manufacturers. Employment levels are envisaged to remain level, with 6 additional existing employees transferring on to the new recycling line, making 12 wood recycling employees in total.

UK Wood Recycling Ltd (UKWR) was launched in Spring 2006 at Wilton on Teesside to support the UK's first purpose-built wood burning power station. The business is based at a facility next to SembCorp’s Wilton 10 Biomass Power Station. The plant takes all grades of non hazardous wood to produce wood chip fuel for the power station - due to be operational by summer 2007, possibly sooner if test firing in early April goes well.

UKWR is contracted to supply up to 80,000 tonnes of wood chip per annum to Wilton 10, although the current waste management licence permits them to reprocess 200,000 tonnes of waste wood per annum at the site.

The additional capacity in excess of Wilton 10’s requirements may be used to supply other bio-mass/co-firing power stations and for manufacturing higher value products, such as the Hadfield (UKWR’s sister company) range of animal bedding, growing media and possibly sewerage filtration chip. The company envisages working to its 200,000 tonne capacity within 3 years, increasing employment levels from 15 up to 40.

Reivers Reprocessing Ltd started its Gateshead open-air wood crushing operation in 1999. The company has supplied others in the past but currently just supply Egger in Hexham. They are the only supplier with a contract from Egger, who will take all the material Reivers can reprocess.

Reivers do not have their own collection infrastructure (vehicles and collection skips) so rely on customers delivering to site and subcontract transport. They currently employ 6 staff on a single shift basis and process.

The company does not have any particular expansion plans, but would look to move to a shift system if sufficient material were available to warrant it. This would give them capacity to reprocess up to 50,000 tonnes a year. The current economic climate is hard for the wood reprocessing industry and the company needs to make its existing plant work harder rather than investing in new sites/equipment.

The site does constrain the company’s ability to expand the scale of its operation– they currently rent adjacent land for storage, but this land could be developed in the future, thus reducing the amount of material the business can store at any one time.

Wood Pellet Energy UK Ltd (WPEUK) is a new business which bought Premier Waste Management’s wood reprocessing infrastructure a year ago and is headed up by Premier’s former manager of the wood reprocessing operation. The business moved to a dedicated site near Darlington in January 2007 and produces fuel pellets from wood waste for domestic and light industrial use.

WPEUK is honouring all the contracts Premier had in place to take waste wood, including contracts for County Durham and Darlington’s civic amenity site wood waste.

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Despite the company’s name, WPEUK also supply Egger. Around 40% of output goes to Egger and 60% is manufactured in to fuel pellets supplied to around ten small scale biomass boilers in Durham and Northumberland Counties.

WPEU hope to invest in a second pellet mill during 2007 which will raise their processing capacity to around 14,000 tonnes a year. The company currently employs 6 but with the planned expansion, would increase to 12- 15.

Other Waste Wood Collectors/Reprocessors operating in the region, include: Thompsons Of Prudhoe (who supply C&I and C&D waste wood to Egger directly and via Reivers); SWS Recycling Ltd of Hartlepool, who pass C&I wood waste on to Egger; Alex Smiles Ltd of Sunderland who undertake bulk municipal collections for Gateshead Council and sell the material on to AWJenkinson in Carlisle (a little also goes to Egger via Reivers); Holystone Ltd of Walls End who also undertake bulky waste collections on behalf of Newcastle and Gateshead and sell material on to AWJenkinson in Carlisle.

A number of other players have C&I/ C&D wood collection operations, including: Tony Shepherd; Evergreen of Darlington; JB Ltd; Scott Brothers; Impetus Group; ALAB Environmental; Newcomb & Sons Ltd; Biffa; JWS of Middlesbrough; Sita; and John Wade.

COMPETING MATERIALS

Virgin Timber The North East region has in excess off 100 thousand hectares of woodland, covering some 12% of its land mass. This equates to over 9% of England’s woodland. Conifer woodland is the dominant forest type which means the region has more in common with the Scottish forestry industry than the rest of England.

Northumberland has the highest predominance of woodland – with Kielder Forest accounting for around half of the whole region’s woodland. It is estimated that the Forestry Industries directly employ 7,827 people and indirectly employs a further 27,741. This contributes a total of around £1.3 billion to regional GVA.

The region produces around 700 thousand cubic metres of timber – predominantly soft wood – per annum (this is equivalent to between 575 and 700 thousand tonnes). Regional sawmill demand for timber is around 400 thousand cubic metres per annum.1 It is estimated that a further 300 thousand cubic metres of timber could be harvested in currently unmanaged woodland.

However, the type of supply in the region does not necessarily match the demand. The region supplies sawmilling operations in the region with red and pallet logs for fencing and pallets. It supplies out of region saw mills with green logs for construction timbers. Round wood logs are supplied to paper mills in Scotland and Scandinavia, to Egger, to energy markets and for animal bedding production within the region. Egger as stated has some of its roundwood supplies from within the region, but also some from Scotland, Yorkshire and Humberside. SembCorp are sourcing their roundwood logs from North Yorkshire and the region’s sawmills import logs from out of region.

Timber prices vary from £18 per tonne to £35 per tonne, dependent upon the type of timber and end use.

Timber prices themselves have increased dramatically on world markets – European prices rose by more than 50% in the summer of 2006. They are expected to rise a further £5 per tonne in quarter 1 of 2007, with increased timber demand from the east rather than west. The pressures on demand for virgin material should bode well for recycled materials.

There has been a growing concern recently that previous estimates of wood availability have been over-optimistic and that all the new interest in the wood energy sector could lead to shortages, as expressed by John Clegg Consulting2, as summarised below:

1 Brendan Callaghan, The Forestry Commission – North East Conservancy

2 Forecast Wood Availability & Demand in Scotland & Northern England to 2016, John Clegg Consulting Ltd, on behalf of the Wood Fibre Processing & Supply Industry, Nov 2006

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Excess Demand Over Supply of Forestry Products in Scotland & Northern England Demand less Supply, Green Tonnes 2007 2012 2016 SRW 7-16cm 93,200 2,474,200 2,286,800 Saw logs greater than 16cm 191,059 737,292 389,392 Sawmill co products 709,854 1,787,327 1,722,382 Coniferous round wood 365,259 2,872,392 2,186,592 All Forestry Products 1,359,372 7,871,211 6,585,166 Source: Derived from data in the John Clegg Consulting report (see footnote 2)

Although these figures cover a much wider geographical area than just the North East, the implications are the same: that demand for forestry products is expected to outstrip supply this year and increasingly so to 2016, without intervention. It also implies increased demand for competitor materials – such as waste wood and arboricultural arisings.

However, it should also be noted that the Forestry Industries are likely to respond to the predicted shortfalls in supply, seeing this as an opportunity to increase replanting programmes and investigate managing/ harvesting woodland which was previously not deemed economic.

There are also moves to recoup economic value from the ‘tops and tails’ or brash, leftover from timber harvesting and previously left on the ground. The Shotton Biomass project in North Wales is trialling a brash baler and converting the material to fuel.

Sawmill Co-Products Quality logs sent to sawmills have the following yields typically:

„ 55 to 60% of the weight becomes sawn panels. „ Around 35% of the weight is lost in bark/ small edge pieces left after the panels have been cut. This material is typically in the form of chips or shavings. „ 5 to 10% of the weight becomes saw dust.

Saw dust is a premium product as it can only be produced as a co-product of sawmill activities and is in demand from animal bedding and panel board manufacturers. The latter use it for coating boards. The panel board industry have established long term contracts with sawmills to prevent material being disposed via the energy route. Consequently prices for sawmill co-products are confidential.

Bark chippings almost exclusively go to the horticultural sector, as do some wood chips. Wood chips and shavings go to industries such as animal bedding and energy.

Sawmill co-products are seen as products in their own right with commercial value. If viewed as waste products they would become subject to waste licensing legislation.

The North East has some 43 workplaces, employing around 495 people, in sawmill-related activities. Around a fifth of the jobs are based at 35 micro workplaces, employing 3 people each on average.

The excess of demand over supply for sawmill co-products was illustrated in the virgin timber section above. The table below illustrates in greater detail where that excess demand is from:

Supply & Demand for Sawmill Co-products, Scotland & Northern England, 2007 to 2016 (green tonnes) 2007 2012 2016 Supply 1,835,732 2,281,589 2,370,885 Forestry Industries Demand 2,210,586 3,543,916 3,568,267 Energy Demand 335,000 525,000 525,000 Total Demand 2,545,586 4,068,916 4,093,267 Regional Shortfall in Supply 709,854 1,787,327 1,722,382 Source: Derived from data in the John Clegg Consulting report (see footnote 2)

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The two largest sawmills in the region are A&J Scott in Alnwick and Taylormade Timber Products in Durham. We estimate these two companies alone generate around 162 thousand tonnes of co-products per annum and that the saw milling industry in the North East as a whole generates around 445 thousand of co-products per annum.

Arboricultural Arisings

The quantity of arboricultural arisings available in the North East each year has not been scientifically established, although industry representatives estimate there may be as much as 100,000 tonnes per year.

Northwoods are the most active body in the region exploring projects to utilise arboricultural arisings in a more commercial manner. Currently most public sector arboricultural arisings are chipped and reused internally as mulch; hence redirecting it to commercial use (for energy) would not actually divert any more waste from landfill.

Saw mills and high-value wood product manufacturers are not interested in arboricultural arisings as the quality can not be guaranteed – the timber has not been grown under controlled circumstances and its exposure in public spaces means it can be contaminated. This only leaves energy as a viable alternative to its current disposal route and the economic case for this has not yet been made.

END MARKETS FOR WASTE WOOD

The Panel Board Industry The Panel Board industry has traditionally been the largest end market for waste wood in the UK. The proportion of recycled feedstock has grown significantly in the past decade, reflecting increasing virgin wood prices, reducing waste wood prices and the relatively higher energy costs to dry virgin wood. In 2005 24% of UK panel board inputs (1.043 million tonnes) were waste wood.

The North East region has just one panelboard plant – Egger in Hexham, who are the largest user of waste wood in the region, as discussed under the section on Reprocessors. Egger’s product mix will allow them to use up to 45% recyclable materials, whilst other manufacturers such as Sonae in Merseyside can use even higher percentages.

Egger’s new production line will allow them to achieve their 45% recyclate inclusion rate and also to burn fines in their WID-compliant boiler to produce process and plant heat.

A new company – Ecopanel Manufacturing – are reported to be looking to open a new 25,000 tonne per annum plant in Teesside, fed by 100% waste wood, although we have no evidence of this project progressing yet.

Virgin fibre and recycled chip are comparable prices where bought in (Egger supply a large part of their own recycled supply chain as they own Timberpak), at £18-20 per tonne. However, drying costs are less for recycled materials and supply shortages may push virgin prices higher.

Biomass The drive towards renewable energy to cut greenhouse emissions, reduce environmental damage and provide long term security of supplies is well documented and driven by both International and UK law.

The use of biomass is generally classed as a ‘carbon-neutral’ process because the carbon dioxide released during the generation of energy is balanced by that absorbed by plants during their growth. Energy can be derived from woody biomass sources (including forest products, waste wood and straw) using combustion systems, which can be used to heat anything from a domestic stove or hot water system to an entire community.

Biomass can also be used on its own or by co-firing it with fossil fuels in power stations.

Precisely what materials can be combusted in a biomass boiler and in what proportions is dependent upon the type of boiler and whether it is compliant with the Waste Incineration Directive (WID). Hence SembCorp’s Wilton 10 boiler is limited to a maximum of 40% waste in its feedstock (’co-incineration’), whilst Egger’s new fully WID- compliant boiler may incinerate 100% waste products (‘full incineration’).

Singapore-owned SembCorp Utilities are commissioning a £60m purpose built 30MW wood-burning power station at Wilton, near Middlesbrough, supported by a £10m Bio Energy Capital grant. The power station will provide

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energy for the Wilton industrial estate (equivalent to powering 30,000 homes) and will require 300,000 green tonnes of wood fuel per year as follows. The fuel will be a mix of logs (from the Forestry Commission & UPM Kymmene at Shotton), sawmill co-products, short rotation willow coppice (from Greenergy Ltd) and recycled wood (80,000 tonnes per annum from neighbouring UKWR Ltd). The plant is scheduled to go live in spring 2007.

As part of the region’s regeneration strategy, the North East has shown tremendous interest in renewable fuels and energy. Around 20 small scale biomass projects across the region provide a total of 3 MW of heating, whilst biomass power stations at Wilton and Lynemouth (powering Alcan) will account for 38 MW of energy.

There are two main types of wood biomass fuels: chips and pellets. Fuel pellets have the advantage of being denser and hence take up less storage, so are more suitable for smaller installations. Increased density can also reduce transport costs (where volume is more constraining than weight of load) and is more homogenous for handling and combustion.

The choice between pellets or chips might also depend on boiler type: co-firing power stations which burn lump coal can take chips, whilst co-firing power stations which burn coal in dust form can take pellets and these may need further crushing. Chips do not crush well and would need to be resized for dust burners.

However, pellets are considerably more expensive than wood fuel chips.

The typical capital investment required to set up a wood pellet production plant with a capacity of around 20,000 tonnes a year is around £2.6 million. A fuel chip operation would not require the pelletising equipment and hence could expect to invest around £1.9 million, but the product is less profitable.

The Biomass industry has the opportunity of diverting low grade waste wood from landfill which is not good enough for the panel board or high value recycled wood markets. There are still no outlets for highly contaminated wood – Chromated Copper Arsenate (CCA)-treated wood, old railway sleepers and telegraph poles – in the UK, but the technology does exist and is believed to be utilised by a company in Germany to extract energy from old telegraph poles and railway sleepers.

Higher Value Products There are eight key UK players in the recycled wood animal bedding and landscaping markets and a number of smaller players, none of which are located in the North East.

Anyone considering entering these markets needs to bear in mind that its profitability is dependent upon scale and having a quality brand: A WRAP commissioned report, WOO0055, concluded that to set up a recycled wood equine bedding plant producing 20,000- 25,000 tonnes of product per annum would require capital investment in the region of £3 million and provide around £1.7 million profit per annum.

The big opportunity for these markets in the region is UK Wood Recycling Ltd at Wilton. They have the knowledge (being Hadfield’s sister company) and capacity for producing the Hadfield brands in the region, with limited additional capital investment. UKWR have stated from their launch that their long-term plans are to diversify from just supplying SembCorp with fuel grade material to also processing higher grade material in to higher value markets.

However, as discussed elsewhere in this report, the key issue currently is securing supplies of material in the region. UKWR hope to be working to full site capacity in three years, but supplies need to be secured first.

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REGIONAL RECYCLED WOOD FLOWS

Waste Wood Flows in the North East Region, March 2007

Waste Wood Collectors Reprocessors Out of the Out of Region Supplies of Municipal; C&I; C&D Region waste wood EG Sita EG EG Premier AWJenkinson, Hadfields Holystone Carlisle Timberpak Alex Smiles SWS John Wade Thompsons of 55,400 tonnes Prudhoe End Manufacturers 468,000 tonnes EG Egger Regional Reprocessors UKWR Energy from Waste; EG Reivers WPEUK Landfill

39,000 tonnes

End Products manufactured in the region & containing recycled wood. EG Panel Board Fuel chips

MARKET OPPORTUNITIES & OBSTACLES

Key Opportunities There is limited opportunity for expanding the regional market of waste wood in to panelboard over and above the expansion already planned by Egger, unless the Ecopanel Manufacturing commence production as apparently planned.

There are opportunities in the biomass sector for waste wood at different levels: power stations, such as Wilton 10; industrial heat/power installations such as at Egger and Alcan; smaller scale public/community projects.

It is important that biomass does not grow so rapidly as to displace existing markets – for all types of woody feedstock. The waste hierarchy needs to be applied- Reduce; Reuse; Recycle; Recover – with energy falling in to the last category.

Opportunities for producing higher value products from waste wood present themselves at UKWR which has 120,000 tonne spare capacity which could be used for high value products, provided additional material supplies of the right grade are secured.

This study has shown that there are growing shortages of forestry and sawmill materials. Conversely, this provides an ideal opportunity for promoting greater use of waste wood. However, there are a number of steps involved in: a) identifying how much more waste wood in the region could be diverted from landfill; b) determining what uses it would suitable for; and c) growing the collection and sorting infrastructure to handle the diverted materials.

There is the potential within the region to implement the kind of collection infrastructure proven elsewhere in the country, such as Hadfield’s successful skip and fleet operations along the M62 corridor. Existing reprocessors in the region are held back by their lack of infrastructure.

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Key Barriers The current economic climate for wood recyclers is not an easy one: low Packaging Waste Recovery Note (PRN) values, high capital investment, rising energy prices and transport costs have all put pressures on recycling businesses.

Confusion over what wood waste is covered by the waste incineration and the waste management licensing regulations and what is not has proven a barrier to the material’s uptake; and as local authorities are not specifically encouraged to recover energy from waste, municipal collection efforts have been focussed on ‘easier wins’, such as glass, paper and card. Low landfill costs in the region have meant, for many, it is still cheaper to landfill wood waste than to transport and pay a gate fee to a reprocessor. This has not encouraged the region to invest in collection infrastructure.

Transport and communications to/from the region are stretched due to its peripheral location.

Waste Management Companies in the region are not investing in recycling. Sita concentrate their efforts on Energy from Waste and Premier are concentrating their efforts on anaerobic digestion systems. Hence there is a limited culture – or economic incentive- for waste sorting and recycling.

POLICY CONSIDERATIONS & RECOMMENDATIONS

The Regional Development Agency (ONE NorthEast) may deem intervention in the wider recycling sector necessary to correct market failures, promote resource efficiency, reduce emissions and recognise increasing landfill costs/ declining landfill capacity. Investment in the recycling sector can also contribute to other regional aims, such as regeneration, employment and encouraging social enterprise.

Environmental Technologies is one of ONE NorthEast’s nine priority sectors and cuts across many sectors over and above the region’s priority sectors. Environmental Technologies is the focus of the New & Renewable Energy Centre (NAREC) based in Northumberland and the Regional Development Agency (RDA) has previously supported a ‘Cluster Strategy’ for the Environmental Technologies sector. Added emphasis on the recycling sector within Environmental Technologies may promote its growth.

Collection & Sorting Although Collection and Sorting activities are not particularly high value-added, the region will not be able to harness the higher value jobs without growth in the supply chain. For instance, the additional high value jobs at UKWR are dependent upon securing supplies, without displacing existing customers for material.

In particular, actions need to be taken to encourage growth in collection capacity in the region. This can be broken down as follows: „ Diverting more from municipal waste by educating both HWRC site staff and the public on material separation and recycling/recovery routes. There is an opportunity to recover more waste from Civic Amenity sites but this should reflect wider recycling rather than just wood. Recovery of wood for recycling should be driven through higher recycling targets and Landfill Allowance Trading Scheme (LATS) targets for Local Authorities. „ Investigation in to extracting more from bulky waste collections for recycling. Currently a large proportion of such collections go straight to landfill instead of being separated and materials recycled where possible. „ Collection service provision suitable for the construction, commercial and industrial sectors. This may require investment in additional vehicles and/or containers. Whether investment is required in developing sites/facilities depends upon whether recycling service providers are performing any sorting/ reprocessing themselves.

Further encouragement needs to be provided to expand capacity here. This might be achieved through grant support towards the costs which would help minimise levels of risk.

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„ To increase collection services suitable for the construction, commercial and industrial sectors those sectors must first be encouraged to segregate waste on site ready for collection, i.e. through the introduction of Site Waste Management Plans (SWMPs). There is the potential to use existing bodies to deliver a marketing campaign for SWMPs, i.e. Construction Excellence with support from bodies such as Envirowise, National Industrial Symbiosis Programme (NISP) and Recycle at Work advisers. „ WRAP are currently working with construction clients, developers and main contractors to set requirements for implementing Site Waste Management Plans, at good and best practice levels, and the actions generated by those plans for major construction projects. To support the realisation of these requirements WRAP are developing Guidance and templates and running in-house training for major contractors. There may be the potential for ONE NorthEast to propose a regional marketing campaign around SWMPs and/or set up demonstration trials on site and work in partnership with the relevant bodies, including Construction Excellence, the WRAP construction team and Envirowise. „ Research is also currently underway at WRAP looking at C&D waste i.e. the quantities of waste going into Materials Recycling Facilities (MRF’s) and recycling levels being achieved by these facilities. This will cover the waste stream as a whole, including C&D wood waste. „ There are a number of social enterprises across the UK involved in the recycling sector, largely focused on the collection of recyclates. Social enterprises harness entrepreneurial drive to achieve wider social objectives. Broad political support exists for the sector to realise its full potential. The RDAs are generally supportive to the sector and ONE NorthEast has provided support for the North East Social Enterprise Partnership (NESEP) bringing together providers in the field to support social enterprise opportunities. „ There are therefore opportunities to address issues relating to the collection infrastructure through targeted support to established social enterprises (such as NESEP and Groundwork Trust) and specific assistance to encourage investment in infrastructure for collection from commercial and industrial sources. This would further help realise wider environmental and community regeneration objectives.

Supply Chain Development Development of wood recycling needs to be considered within the context of supply chain / market development initiatives for the recycling sector overall, not least because of the degree of overlap particularly in relation to collection infrastructure.

ONE NorthEast have commissioned Valpak to undertake a study with the express objective: “to recommend and detail a delivery model for an initiative that will provide business support to the recycling and reprocessing sector in the North East, to enable it to expand, develop and capture the maximum share of the market to provide the greatest economic impact.”

Recycle at Work Considerable opportunities arise as a result of the recent recruitment of a Recycle at Work Adviser by WRAP who is based at ONE NorthEast. The role of the adviser includes encouraging SMEs to recycle waste and connecting recyclers with potential SME waste suppliers. It is likely that this role will further identify constraints, opportunities and potential interventions for the Regional Development Agency in relation to wood recycling and the regional recycling sector as a whole.

The Recycle at Work Advisor role may also facilitate a greater degree of networking with businesses and specifically with key players developing / expanding wood processing facilities in the region.

WRAP have commissioned work which will further inform the needs and barriers facing SMEs wishing to recycle more. This will include identification of areas where there are gaps in the availability of service provision.

The Recycle at Work advisors also have a role in supporting increased collections and developments to the supply chain.

Regional Market Assessment for Wood Waste for North East England 13

Land & Premises The North East has been successfully regenerating its urban areas. This has inevitably resulted in a degree of displacement as higher value uses out-compete lower value ones for land, including recycling. There is a need to ensure the availability of well placed serviced sites that are suitably located in areas where they will not conflict with neighbouring uses and access is good.

There may be potential benefits of shared infrastructure and knowledge from providing sites dedicated to recycling activities.

Good Practice in Construction & Land Remediation RDA spend is quite heavily skewed towards physical renewal and investment in land remediation, growth and development. This raises the potential of RDAs to directly influence the demand for recycled products through tenders and specifications.

Opportunities arise where brownfield sites are remediated, especially for open space but also residential uses with gardens and landscaping. Depending on local availability of materials, this can create demand for waste derived products for use in landscaping, such as composts and landscaping mulches.

Development – either to regenerate communities or to build new ones – also raises the prospect of promoting sustainable construction, including the use of recycled and secondary aggregates and other building materials with recycled content in buildings and highways.

This should be linked to the activities and priorities of Construction Excellence North East (CENE) which has been established to showcase innovations and spread best practice in construction. One of CENE’s aims is to bring clients, industry and government, together to share best practice.

Procurement Sustainable procurement has become more prominent in Government policy debate. The National Procurement Strategy sets targets for every local authority and advises that they should use their purchasing power to create market demand for recycled materials or products. This includes public sector procurement (especially in relation to landscaping for example), but also influencing the private sector through for example initiatives like London’s Green Procurement Code.

Whilst the market share of recycled products in conscious procurement is currently low, there is substantial scope to increase the demand for recycled products through procurement. In relation to wood this includes opportunities for landscaping materials and biomass energy.

In this context the North East is known to be examining the possibility of establishing a ‘Regional Procurement Executive’ (RPE).

Education, Training & Awareness Education, training and awareness measures to promote wood recycling are required to be aimed at the following: „ Local Authorities: to know what they can extract from the waste stream and where they can send it; „ CA site staff: to separate different grades of wood waste and forward it to the highest value end user for that material; „ Businesses: to know what they can do with their wood waste – and why it is in their interest to do so; „ The public: to know what wood is contaminated (e.g. potentially CCA treated garden timber) and to keep panel board products separate from solid wood.

This could be accompanied with training materials that could be used by local authorities and industry to better segregate wood waste to the specification of local users and that address some of the barriers identified.

In addition it is important to raise awareness across all business sectors and particularly the SME sector, of the advice and facilities available such as the Recycle at Work adviser, NE Recycling Forum etc. This should be done in conjunction with the ONE NorthEast BREW network.

Regional Market Assessment for Wood Waste for North East England 14

As part of this general theme, ONE NorthEast could give consideration to initiatives designed to promote greater networking within the business community. This includes more general marketing which could be promoted in conjunction with a dedicated website and advice to connect demand for recyclate to supply. For example, RecycleWood is an interactive resource produced by WRAP to help producers of wood waste find collection services and recycling facilities and to link potential buyers of recycled wood products to suppliers. This is a free resource that can be used simply by entering a postcode or using the search facility.

This approach is similar to what NISP have achieved in lining up supplies from Sita and John Wade to UKWR. During this study we were also able to match up private and public sector bodies with potential customers for various grades of wood waste, indicating that there really is a need for such an initiative in the region. This could cover multiple waste streams. Mention has previously been made of skills shortages / technicians. Further research is probably required here to validate this view. This sensibly might look beyond wood to the recycling sector as a whole.

Depending on the outcome of this research there may be implications in terms of education and training including involvement of relevant skills agencies.

Further Research – Wood Waste Data

Better wood waste data for the region is required as follows:

„ Municipal Waste: there is reasonable data on what wood waste has been extracted from the municipal waste stream for recycling, but not what has gone on to landfill. There are several parties interested in identifying more material to divert – including: South Tyneside Recycling Village; UK Wood Recycling Ltd; UK Pallet Energy Ltd.

We would suggest that ONE NorthEast works with these bodies to set up practical assessments of the volume and type of wood waste which is currently going to landfill. This may mean funding sorting and education trials at Civic Amenity sites and bulk waste collection transfer stations. However, sorting activities at CA sites could potentially be limited due to restricted site access and issues with space on site.

„ Commercial & Industrial Waste/ Construction & Demolition Waste: a more thorough survey of skip companies and wood recyclers in the region would identify what quantities of C&I/C&D are already being diverted, but identifying the quantities currently going to landfill which could be recycled is more difficult, not least because the companies generating wood waste are mainly SMEs.

We would suggest starting by analysing the sectoral structure in the region and targeting specific industries to track down a) what quantities and types of wood waste they generate and b) where this waste currently goes. For example, all the public sector maintenance companies could be targeted to identify their wood C&D waste. Survey results could be scaled up in proportion to the numbers working in the region in that sector. Companies within the wood recycling sector, such as UK Wood Recycling and Wood Pallet Energy UK have an interest in this research, hence working in conjunction with them is an option.

„ Arboricultural Wood Waste: knowledge in this area of wood waste is predominantly opinion rather than scientifically based. Further research is required – possibly in conjunction with Northwoods – to ascertain a more accurate picture of regional arisings and the feasibility of introducing Tree Stations to capture such waste and divert it from its current nil-value uses (in situ or as mulch in internal markets) to biomass fuel production.

„ There is also potential for further research in to the potential for Local Authorities to provide more bulky waste collections of wood and other materials, what tonnages of materials suitable for recycling (including wood) could be retrieved from such collections and what returns the Local Authorities could expect from these recyclates.

Regional Market Assessment for Wood Waste for North East England 15

„ Having conducted a thorough audit of wood waste streams in the region, the types of wood could be quantified and matched against different end uses:

A grade Æ high value and panel industries B grade Æ a little to panel industries, rest to energy C grade Æ energy D grade Æ landfill

Regional Market Assessment for Wood Waste for North East England 16

Contents

Acknowledgements ...... 18 Definitions ...... 18 1.0 Introduction ...... 19 2.0 The Regional Economy ...... 22 3.0 Wood Waste Arisings ...... 29 3.1 Municipal Waste ...... 29 3.2 Commercial & Industrial...... 32 3.3 Construction & Demolition...... 34 3.4 Agricultural ...... 35 3.5 Arboricultural ...... 35 3.6 Summary of Wood Arisings & Recycling in the North East ...... 36 4.0 North East Waste Wood Reprocessing...... 37 4.1 Egger (UK) Limited ...... 37 4.2 UK Wood Recycling Ltd (UKWR) ...... 38 4.3 Reivers Reprocessing Limited ...... 39 4.4 Wood Pellet Energy UK/Premier Waste ...... 40 4.5 Thompsons of Prudhoe ...... 41 4.6 SWS Recycling Limited...... 41 4.7 Alex Smiles Ltd...... 42 4.8 Holystone Ltd...... 42 4.9 Other North East Wood Recyclers/ Reprocessors ...... 42 5.0 Competing Materials ...... 44 5.1 Forestry ...... 44 5.1.1 The Forestry Industry in Great Britain ...... 44 5.1.2 The Forestry Industry in the North East Region ...... 45 5.1.3 Supply and Demand for Forestry Products in the North East Region...... 47 5.2 Sawmill Co-Products ...... 50 5.2.1 Supply and Demand of Sawmill Co-products in the North East...... 51 5.2.2 North East Sawmills ...... 51 5.3 Arboricultural Arisings ...... 52 6.0 End Markets ...... 55 6.1 Panel Board Industry ...... 55 6.2 Biomass Energy...... 57 6.3 Higher Value Markets for Waste wood ...... 67 6.3.1 Animal Bedding & Surfaces...... 67 6.3.2 Landscaping Products...... 70 6.3.3 Other Markets for Waste wood ...... 75 7.0 Regional Recycled Wood Flows...... 76 8.0 Market Opportunities & Obstacles ...... 77 8.1 End Market Opportunities...... 77 8.2 Other Opportunities ...... 78 8.3 Obstacles to Market Development ...... 78 9.0 Policy Considerations ...... 81 9.1 Policy Context ...... 81 9.2 Collection & Sortation Infrastructure ...... 82 9.3 Supply Chain Development...... 84 9.4 Recycle at Work ...... 84 9.5 Land Premises...... 84 9.6 Promoting Good Practice in Construction & Land Remediation...... 84 9.7 Procurement ...... 85 9.8 Education, Training and Awareness ...... 85 9.9 Further Research - Wood Waste Data ...... 86 10.0 Conclusions & Recommendations ...... 87 10.1 Conclusions...... 87 10.2 Recommendations ...... 87

Regional Market Assessment for Wood Waste for North East England 17

Appendices ...... 90 Consultees & Bibliography ...... 90

Acknowledgements

ESYS would like to thank all the organisations and individuals who gave their time and views to this study. A list of the consultees can be found in Appendix A1. In particular they would like to thank the Steering Group of Gillian Coe, Peter Webster and Sarah Downes of WRAP, and Ray Waters of ONE NorthEast.

Definitions

Waste Wood Waste wood which has previously been a product. „ Old wooden furniture is post-consumer waste

„ Broken/old pallets are post commercial/industrial waste

„ Waste wood from timber planks used in secondary industries such as furniture manufacturing, is post-industrial waste.

Co-products Wood co-products produced from primary forestry or saw mill operations not classed as waste. For example, saw mill wood flakes and sawdust; bark; forestry brash.

Re-use Re-using a product for its original use e.g. refurbishing and re-using a wooden pallet

Recycle Recovering material from waste and using it to make a new product. E.g. chipping waste wood and using it to make animal bedding/ landscaping products/ panel board etc. Recovery Recovering energy from waste. E.g. using waste wood as fuel.

Regional Market Assessment for Wood Waste for North East England 18

1.0 Introduction

Background to the Study In 2006 ONE NorthEast commissioned Enviros to write a Regional Recyclate Market Development Plan for the North East region. This document covered multiple waste streams, including wood, and set the scene for further work in each of these streams. Waste wood is of particular interest in the region due to a number of high profile developments: „ UK Wood Recycling Ltd’s new Teesside plant with a capacity to reprocess up to 200,000 tonnes of waste wood per year, sited adjacent to SembCorp’s Wilton 10 biomass power station, which will be supplied with 80,000 tonnes of recycled wood fuel chip per annum by UKWR; „ Egger (UK) Ltd’s investment in a new production line and fully WID-compliant boiler which from April 2007 will enable them to use significantly higher volumes of recycled wood than at present; „ A number of recent publications expressing concern that demand in Scotland and Northern England for Forestry products will far outweigh supply, due to increased demand from both traditional users of Forestry products and the relatively new biomass sector.

WRAP wish to improve their understanding of the supply and demand for post consumer wood waste in the North East of England. This will enable WRAP to inform and assist the RDA in identifying gaps in the regional supply chain and market development opportunities.

The study also considers supply and demand of virgin materials, both from forestry and primary processing (sawmill co-products), and from arboricultural arisings.

Study Objectives The key objectives of this study are to: „ Investigate the current supply chain for wood recycling and biomass sectors, including the structure of the sector from arisings to reprocessing, infrastructure and flow of materials. „ Review overall demand for waste wood, including the energy market, broken down by quality and specification requirements. „ Assess the business case for realising additional recycling opportunities and the barriers to expansion, to make recommendations and propose actions on supporting the development of recycling in the region, including the contribution to economic development and strategic commentary on the growth of energy markets and impact on growth in the recycling sector.

Legislative Drivers There are legislative drivers affecting both the supply and demand sides of the wood recycling and recovery sector.

On the supply side, EU and UK legislation such as the Packaging and Landfill directives are putting ever- increasing pressures on the nation to landfill less and recover/recycle more.

On the demand side the Climate Change Levy and Renewables Obligation have put the spotlight on green energy sources, including woody biomass. This could be tempered by the affect of the Waste Incineration Directive (WID).

At present the combustion of waste wood does not need to comply with WID legislation UNLESS the wood has been contaminated with halogenated organic compounds or heavy metals (usually compounds of copper chrome and arsenic – known as ‘CCA treated’). In practice this means ‘clean’ wood can be burned outside of WID restrictions whereas treated wood waste (such as wood impregnated with stains and preservatives) can only be burnt in a WID-compliant boiler. This has led to confusion and some assume no waste wood can be burnt outside of WID-compliance. Also, the restrictions may become tighter in the future.

Organisations incinerating waste covered by WID can only do so with a Pollution Prevention & Control permit (PPC). To obtain a PPC the organisation may have to meet certain conditions such as the boiler temperature (e.g. 850ºC / 2 seconds and 1100ºC / 2 seconds for hazardous wastes with greater than 1% halogenated organic substances) and the proportion of controlled to non-controlled feedstock which can be incinerated.

Regional Market Assessment for Wood Waste for North East England 19

The PPC permit will also stipulate upper limits on emission levels and require monitoring.

It is the intention of legislation to maintain the waste hierarchy – reduce; reuse; recycle; recover in that order – but in practice there are fears that the energy sector could divert waste wood from existing well established markets.

The panel board industry in particular, has expressed concerns about this, as illustrated by the following quote from Egger Connect corporate magazine: “Demand for wood in Europe already exceeds supply in some regions. Not least because of the large number of biomass plants under construction and the sharply rising number of pellet heating systems, we will see a huge timber shortage, leading to drastic price rises of as much as 30% a year. …… similar trends are emerging in all … EU Member states… Material recycling of wood has a far greater impact on employment compared with thermal“3

The article goes on to state that a panel board line would employ 55 people for every 100,000 tonnes of wood per annum, whilst a biomass plant would only employ 4 for the same tonnage.

Grades and End Uses of Waste Wood Grades of waste wood may be summarised as follows: 1) Clean recycled waste wood; 2) Panelboard grade (a mix of grade 1 and mixed grade wood); 3) Fuel grade; and, 4) Hazardous grade4. The table below gives more detail of the types of wood in each of these:

Waste Wood Types End Uses A. Clean Grade Packaging and post industrial scrap; Higher value products: animal completely untreated bedding; landscaping etc. Panel board Bi. Mixed Grade – around 1 million C&D; CA site & Transfer station Panel board can take 66% clean tonnes per annum material. NOT panelboard or grade/ 33% mixed grade (once hazardous wastes. fines removed). Grit is sifted out of this material and paints come out in the sub 5-6mm material (10% by weight – fines). Bii. Fines from mixed grade – By-product of above. Use in incineration is limited by around 100-100ktns pa potential damage to boilers. Waste Management Licensing requirements will restrict use in bedding and on farm composting. A reduction in these end markets will affect the economics of recycling. C. Fuel grade 80% panel wood waste; 10-20% Resins prevent use in panel board other wood e.g. heavily painted. manufacturing. Hence only market Source: CA sites and panel board is Energy. manufacturers’ scrap The Furniture Industry Research Association (FIRA) are developing a micro-release system which will separate wood and resin fibres in panel board waste. D. Hazardous Sleepers; Telegraph Poles; CCA Currently no outlet for this in the treated (Chromated Copper UK. Arsenate) – or chemical wood preservative. One issue is that you cannot visibly determine whether wood has been CCA treated or

3 EGGER connect – July 2006

4 Recycling Waste World, Nov 23 2006

Regional Market Assessment for Wood Waste for North East England 20

treated with a less harmful preservative. Hence old fencing, decking and other garden timber can not be recycled.

The Structure of This Report

The remainder of this report is structured as follows: 2. The Regional Economy 3. Waste Wood Arisings 4. Wood Reprocessors 5. Competing Materials 6. End Markets for Waste wood 7. Regional Waste Wood Flows 8. Market Opportunities and Obstacles 9. Policy Considerations 10. Conclusions and Recommendations

Appendices: A1 Consultees & Bibliography A2 Detailed Waste Flows **CONFIDENTIAL AND UNPUBLISHED**

Regional Market Assessment for Wood Waste for North East England 21

2.0 The Regional Economy

Regional Profile

The North East is one of the smallest of the English regions in both area (8,592 square km) and population (2.6 million, 5% of England’s population).

It is a region of great contrasts. The hills, moorlands and forests of the North Pennines and Border Hills form its western part. Its eastern side is a 160-kilometre section of North Sea coastline, on which long-established industrial conurbations are grouped around the main river estuaries of the Tees, Wear and Tyne. Whilst two- thirds of the region is rural, a third is National Park (Northumberland National Park and part of North York Moors National Park) or an Area of Outstanding Natural Beauty (North Pennines and the Northumberland Coast). The region also has two World Heritage Sites: Durham Cathedral and Hadrian's Wall.

Table 2.1 illustrates that the North East is administered by 2 county, 13 district and 10 unitary authorities across 4 sub regions. The two County sub-regions (Durham & Northumberland) are largely rural whilst Teesside and Tyne & Wear are mainly urban.

Table 2.1 – North East Government Structure & Population

2005 Sub Region District/ Unitary Authority Population Alnwick District Council 32,200 Berwick-upon-Tweed Borough Council 26,200 Blyth Valley Borough Council 81,600 Castle Morpeth Borough Council 49,900 Northumberland Tynedale District Council 59,800 County Council Wansbeck District Council 61,700 Chester-le-Street 53,200 Derwentside 86,300 Durham City Council 92,200 Easington 93,300 Sedgefield 87,800 Durham County Teesdale 24,900 Council Wear Valley 62,100 Gateshead MBC 191,500 Newcastle-upon-Tyne City Council 276,400 North Tyneside MBC 192,300 Tyne & Wear South Tyneside 151,300 Unitary Authorities Sunderland 283,700 Darlington 99,200 Hartlepool 90,000 Middlesbrough 137,600 Teesside Unitary Redcar and Cleveland 138,600 Authorities Stockton on Tees 186,700

Source: ONS mid-year population estimates [2005] 2,558,500

Regional Market Assessment for Wood Waste for North East England 22

Economic Performance

The North East is the poorest of all of the English regions with an economic output 40% below that of London. With two-thirds of the region being rural, the performance of the rural economy is very important.

Table 2.2 illustrates the region’s economic position in comparison to England as a whole. It can be seen that the region’s median earnings are only 87% of the earnings in England as a whole, with Hartlepool, Stockton and Northumberland being the best paid areas and North/South Tyneside and Sunderland the worst. The percentage of working age residents claiming Job Seeker’s Allowance (JSA) is higher in the North East at 3.2% than the national average of 2.5%. Interestingly the areas with the highest level of JSA claimants are Hartlepool, Middlesbrough and South Tyneside – the traditional industrial areas. It is interesting that Hartlepool has the highest gross weekly earnings in the region but the third highest level of job seekers – implying that the jobs in Hartlepool are better paid but there are not enough of them.

An analysis of Gross Value Added (GVA) shows that the North East accounted for only 3.9% of England’s GVA, despite representing 5.1% of the population. GVA per head figures show the North East adding value at 77% of the English rate.

Table 2.2 – Comparative Economic Indicators for the North East Region

Median Job Seekers GVA £ per Gross Compared Claimant Compared head, Weekly Pay £ to All Rate, Nov Compared to to All compared England: 2006 All England: 2004 GVA £million England: to England England 370.6 100% 2.5 100% England 878,247 100% 17,532 North East 322.0 87% 3.2 128% 100% Darlington 318.5 86% 2.9 116% North East 34,419 3.9% 13,524 County Durham 325.8 88% 2.2 88% 77% Gateshead 325.6 88% 2.9 116% Tees Valley & Durham 14,068 1.6% 12,246 Hartlepool 346.9 94% 4.4 176% Hartlepool & Stockton on Tees 3,647 0.4% 70% Middlesbrough 287.1 77% 5.0 200% South Teesside 3,375 0.4% Newcastle-upon-Tyne 328.8 89% 3.2 128% Darlington 1,613 0.2% North Tyneside 315.2 85% 3.0 120% Durham CC 5,433 0.6% Northumberland County 337.9 91% 2.6 104% Redcar and Cleveland 290.0 78% 3.8 152% Northumberland and Tyne & Wear 20,351 2.3% 14,574 South Tyneside 306.6 83% 4.6 184% Northumberland 3,563 0.4% 83% Stockton on Tees 335.9 91% 3.3 132% Tyneside 12,754 1.5% Sunderland 312.6 84% 3.3 132% Sunderland 4,034 0.5% Source: Office for National Statistics

Industrial Structure

Economic restructuring in the 1970s and 1980s saw a decline in the manufacturing sector within the region. Table 2.3 shows that the most significant sectors in the region are the Public Sector (32%), Distribution & Leisure (22%), Finance (16%) and Manufacturing (12%).

No. Workplaces, No. Employees, Table 2.3 - North East Workplace Analysis, 2005 2005 2005 02 : Forestry, logging and related service activities 126 169 0.02% 20 : Manufacture of wood and products of wood and cork, except furniture 291 3,532 0.33% 21 : Manufacture of pulp, paper and paper products 66 4,126 0.39% 361 : Manufacture of furniture 225 5,051 0.48% 1 : Agriculture and fishing (SIC A,B) 390 4,582 0.43% 2 : Energy and water (SIC C,E) 191 8,871 0.83% 3 : Manufacturing (SIC D) 5,170 131,253 12.34% 4 : Construction (SIC F) 6,258 61,689 5.80% 5 : Distribution, hotels and restaurants (SIC G,H) 23,257 237,467 22.33% 6 : Transport and communications (SIC I) 3,157 53,753 5.06% 7 : Banking, finance and insurance, etc (SIC J,K) 17,515 166,112 15.62% 8 : Public administration, education & health (SIC L,M,N) 8,803 345,360 32.48% 9 : Other services (SIC O,P,Q) 5,324 54,243 5.10%

Source: National Statistics 70,065 1,063,330 100.00%

Regional Market Assessment for Wood Waste for North East England 23

Table 2.4 provides more information on employment in wood-related industries within the region. Although not all manufacturers of furniture (SIC 3611-3614) and recyclers of non-metallic waste (SIC 3720) will work with wood, this does give us an indication that less than 0.86% of the region’s workforce may be involved in wood-related industries. However, 5.8% of English employment in these wood-related activities is in the North East, whilst only 5% of the English population reside in the region.

Table 2.4 - North East Employment in Wood-Related Industries No. Employees, 2005

England North East

0201 : Forestry and logging 3,976 167 4.2% 0202 : Forestry and logging related service activities 899 2 0.2% 201 : Saw milling and planing of wood, impregnation of wood 7,210 495 6.9% 202 : Manufacture of panel boards etc.. 3,888 733 18.9% 203 : Manufacture of builders carpentry and joinery 38,630 1,626 4.2% 204 : Manufacture of wooden containers 4,954 272 5.5% 2051 : Manufacture of other products of wood 8,005 405 5.1% 2111 : Manufacture of pulp 38 0 0.0% 3611 : Manufacture of chairs and seats 22,043 1,222 5.5% 3612 : Manufacture of other office and shop furniture 15,291 413 2.7% 3613 : Manufacture of other kitchen furniture 13,066 1,380 10.6% 3614 : Manufacture of other furniture 32,472 1,967 6.1% 3720 : Recycling of non-metal waste and scrap 8,331 470 5.6%

158,803 9,152 Source: National Statistics 5.8%

Of particular interest are the 495 employees in the sawmilling industry – Section 5.2.2 below helps to inform a view as to the volume of saw-mill co-products (a competitor of recycled wood) available in the region. Similarly employment in the secondary wood processing industries (SIC codes 202 to 2051) should help in estimating post industrial wood waste.

SIC 2020 – manufacturing panel boards etc – has nearly a fifth of its English employment in the region. This is presumably at Egger Hexham, which not only generates wood waste but is also a key user of recycled wood.

Wood pulp production for the paper industry does not occur in the region, although the forestry industry in the region may supply the pulp industry elsewhere.

Regeneration Funds

Much of the North East region has benefited from European assistance under the programme which ended on 31/12/06.

European funding is distributed from the European Commission, to areas in economic decline or in need of regeneration.

The North East benefits from three types of European funding. These are: „ Objective 2 funding which brought £500 million in to the region between 2000-2006. The budget had four priorities: encouraging entrepreneurs; developing businesses; developing employment opportunities; and developing target communities. Objective 2 projects are funded by the European Regional Development Fund (ERDF). „ Objective 3 funding which brought a budget of £200 million in to the region and focused on improving education, training & work experience. Objective 3 projects are funded the European Social Fund (ESF). „ The North East also benefits from four projects via the European Community Initiative programme.

The new programme covering 2007 – 2013 replaces the Objectives 2 and 3 programmes with a new Competitiveness Objective programme, which all of the North East will be eligible for. The region’s budget for the period is £240 million. How this money will be used is currently under consultation.

Regional Market Assessment for Wood Waste for North East England 24

The UK Department for Trade & Industry also have ‘assisted areas’ for allowing selective regional assistance. In 2000-2006 the eastern strip of the North East region was designated a DTI assisted area. The boundaries are currently being redrawn for 2007-2013 and it looks likely that the assisted area in the North East will be concentrated on Teesside.

The North East’s access to EU and UK regeneration funds does give it some advantage in investing in new industries and establishing new companies over UK regions without assistance. However, it is clear that with new EU member states, the money available and the areas targeted will be on a smaller scale than in the previous programme.

Delivery Partnerships

Delivery Partners key to opportunities in wood recycling in the region are as follows:

Regional The RDA – ONE NorthEast – has a key role to play in overcoming barriers and taking Development Agency advantage of opportunities to expand the regional market for wood recycling. It has (RDA) access to both EU/UK regeneration funding and funds business support bodies. Key roles within ONE NorthEast include: Ray Waters, Senior Specialist in Sustainable Resources Chris Maxwell, Biomass, Biofuels and Forestry Coordinator (a role which transferred from the EIF). ONE NorthEast has just funded a £1.1 million Bio Energy Development Service. A 2.5 year contract to a service provider has been awarded to give technical support (with an 80% subsidy), business planning support, marketing activity and training for SMEs in the sector.

Waste & Resources WRAP is not-for-profit company created in response to the Government’s Waste Strategy Action Programme (2000). They have a range of practical support programmes, including business support (WRAP) to SME’s, and support and development of the manufacturing sector. WRAP have recently appointed a Recycle At Work adviser, based at ONE NorthEast

Environmental EIF was a business-led and membership driven organisation whose members have Industries Federation businesses in the environmental sector in the North East. It provided advice on funding, (EIF) international trade and marketing. It also provided networking opportunities, lobbying and access to market information and trade shows.

It was ONE NorthEast-funded but has now ceased operation. Some of its functions will be and carried out by other bodies, such as ONE NorthEast’s Bio Energy Development Service, and EIF’s biomass coordinator who now works directly for ONE NorthEast. EIF’s website does still exist (www.eif.org.uk) and has access to some useful links, research reports, presentations and background information.

The North East Recycling Forum has been in existence for approximately 15 years. North East Recycling Membership of the forum is open to anyone and the current membership of 145 consists Forum (NERF) of local authorities, private sector companies and the general public. The forum is a non-profit making organisation, with an objective of seeing society take a more proactive approach to recycling. There is particular emphasis on improving recycling rates and developing markets for recyclates. NERF works towards this by liaising with Government. NERF’s meeting presentations can be accessed on EIF’s website.

Sub Regional The four sub regions have Economic and Environmental partnerships, although the Partnerships (SRPs) degree of interest and involvement in recycling activities vary between them. The most involved is Tees Valley Economic Partnership, which works closely with Renew Tees Valley (see detail below). Northumberland Strategic Partnership has an officer (Clive Fagg, based at the County Council) whose role it is to promote renewable energy via regeneration. With Egger and Alcan based in the County, the partnership has an interest in both wood biomass and panel board end markets for waste wood. County Durham Environmental Partnership has some interest in school biomass projects and the county woodlands strategy.

Regional Market Assessment for Wood Waste for North East England 25

Tyne & Wear Partnership have had no involvement to date in recycling projects, although there is an opportunity to role out the kind of activities Renew Tees Valley/ Tees Valley Partnership have been undertaking across the region.

Renew Tees Valley Renew Tees Valley Ltd is a company limited by guarantee, with funding provided through Ltd (RTV) the Tees Valley Partnership on behalf of the Regional Development Agency (ONE NorthEast). It operates across the five borough councils that make up the Tees Valley. It was set up in 2003.

RTV aims to promote the Tees Valley as a centre for renewable energy and waste management technologies, leading to new economic activity. This will come through inward investment, the creation of new businesses, and helping existing local businesses to develop/diversify into new markets in renewable energy and recycling.

One of the key objectives for Renew Tees Valley is to make it easy for companies that are interested in renewable energy or recycling to develop their businesses in the sub region. Another is to ensure that across the Tees Valley there is an integrated approach to sustainable development and waste management.

The organisation is viewed by many as a success whose approach should be rolled out across the whole North East region.

Northwoods Northwoods is the North East’s Woodland Initiative, supporting woodland and forestry businesses. It provides business support, training and research. It has been active in trying to redirect municipal arboricultural wood waste from either being left on site or landfilled in to wood fuel chip production instead. The organisation runs the Ignite training scheme. This award-winning course has supported the development of woodfuel enterprises across most parts of northern England and Scotland since being developed by the Northwoods team and partners in 2004. Those attending the course have gained a grounding in the economics of wood fuel supply, the technologies that are available to produce wood fuel and the systems that burn it. Ignite is accredited by Lantra Awards and sits alongside chainsaw and similar qualifications in the forestry qualifications framework.

North East Wood North East Wood Fuels, or NEWFuels, is the wood fuel producer group for North East Fuels (NEWF) England, established as a not-for-profit company with funding from Defra’s Bio- Energy Infrastructure Grants Scheme. It was set up by Northwoods in 2005 and Northwoods hosts NEW Fuels information on its web site. NEWFuels facilitate the supply and delivery of all types of wood fuel across the North East of England, acting as a broker for its members. It also provides independent advice, information and a Quality Assurance service.

The Forestry The Forestry Commission have an interest in wood recycling from a sustainability point of Commission view. They believe in the recycling hierarchy – Reuse; Recycle; Recover – in order to protect and not waste virgin timber.

The National NISP brings together companies from all business sectors with the aim of improving cross Industrial Symbiosis industry resource efficiency through the commercial trading of materials, energy and Programme (NISP) water and sharing assets, logistics and expertise. It engages traditionally separate industries and other organisations in a collective approach to competitive advantage involving physical exchange of materials, energy, water and/or by-products together with the shared use of assets, logistics and expertise. NISP North East has been operational since April 2005 from the University of Teesside and has been instrumental in redirecting waste wood from landfill to the new UKWR plant supporting SembCorp’s Wilton 10 power station.

Regional Market Assessment for Wood Waste for North East England 26

Significance of Wood-related Industries to the North East Regional Economy

In Table 2.5 below further details are provided in terms of the significance of the wood-based industry in the region, focusing specifically on employment. In particular, the table details the significance of the industry in relation to the manufacturing sector and also relative to the rural economy.

It is important to examine the significance of the industry in relation to the rural economy which is of specific interest to the RDA and forms one of the RDA programmes. Moreover, it is of general interest in the context of the wider regeneration agenda given the decline of the ‘traditional rural economy’ including notably agriculture and utilities based employment in water and electricity generation.

The table indicates:

„ The region has 5% of England’s population, 5.16% of England’s manufacturing employment and 5.62% of its wood-based manufacturing employment. However, there is a high prevalence in Saw Milling activities and in particular (due to the presence of Egger UK in Hexham), panel board manufacturing with some 19% of total employment in this sector. „ Wood-based manufacturing employment is split fairly evenly between the rural and urban sub-regions. However, in relative terms, the wood sector is of far greater significance to the rural economy. „ It has a surprisingly low percentage of England’s Forestry employment (3.47%) considering that the region has 8.9% of England’s woodland. „ The other wood-based industry is producing pulp for paper production. There is no pulp production activity in the North East region and only 38 such jobs in England as a whole.

Table 2.5: The Economic Significance of Wood-Based Industries in the North East, Employee Numbers in 2005

WOOD-BASED MANUFACTURING Forestry ALL Area Panel Other Industries Saw Mills ALL Manufacturing Boards Products

England 4,875 7,210 3,888 51,749 62,847 2,545,920

North East 169 495 733 2,304 3,532 131,253

NE share: 3.47% 6.87% 18.85% 4.45% 5.62% 5.16%

Northumberland 156 122 441 338 901 11,328

County Durham 11 130 117 586 833 28,103

Rural NE 167 252 558 924 1,734 39,431

Teesside 0 14 2 623 639 31,253

Tyne & Wear 1 229 172 758 1,159 60,568

Urban NE 1 243 174 1,381 1,798 91,821

Source: Annual Business Inquiry Employee Analysis, 2005

In economic terms, the wood-based industries sector is important to the region – representing around 3% of the region’s manufacturing jobs and 5.6% of England’s wood manufacturing jobs. The 3,700 regional jobs in saw milling and wood based manufacturing industries can be estimated to contribute around £50 million to regional Gross Value Added (GVA), based on the regional average GVA per head of £13,524 in 2004. Salaries from the sector amount to some £62 million per annum (based on average gross weekly wages in the region of £322).

Regional Market Assessment for Wood Waste for North East England 27

Economic Benefits Associated with Growth of Wood-Related Industries

To illustrate the potential economic benefits of growing the sector: if policy drivers were to successfully increase employment by an additional 10% in wood based industries in the region this would result in the net additional contribution of: „ 370 jobs „ £5 million GVA „ £6.2 million regional gross incomes.

Importantly for the RDA, such expansion would significantly benefit the rural economy.

The larger the wood based industry is in an area the greater the volume of post-industrial wood waste and the greater the potential for wood recycling industries. However, the volume of post-consumer and post commercial wood waste in the area is not related to the size of the wood based industry.

The wood recycling sector in the region has four main employers: „ Egger at Hexham, who employ 6 staff in their recycling plant and plan to increase this to 12 after their new line goes live in April 2007. „ Reivers Reprocessing in Gateshead employ approx. 6 staff, as does Wood Pellet Energy UK Ltd. Reivers have no plans to increase staffing numbers, but WPEUK plan to increase staffing levels to 12-15 if they get a second production line up and running in the next year. „ UK Wood Recycling Ltd currently employ approx. 15 but plan to increase staff numbers up to 40 over the next few years as their business ramps up.

There are other wood recycling operators, although these tend to be waste management and collection companies who process wood as part of a wider operation.

Looking more narrowly, the impacts on the regional economy of dedicated wood recycling employment can be summarised as follows:

Current Within 3 to 5 Years Employment numbers in the North East 33 73 Annual GVA @ £13,524 per head (at 2004 values) £446 thousand £987 thousand Annual Gross Income @ £322/week (2006 median) £553 thousand £1,222 thousand

Regional Market Assessment for Wood Waste for North East England 28

3.0 Wood Waste Arisings

3.1 Municipal Waste

Table 3.1.1 : Municipal waste arisings (tonnes), 2005/6

Regular Other Civic Household Total Non-household Non Total Authority household household amenity recycling household residual (excl. household municipal Authority Type collection sources sites waste recycling) recycling waste Stockton-on-Tees Borough Council Unitary 65,385 3,956 5,024 13,319 87,684 2,163 5,873 95,721 Redcar and Cleveland Borough Council Unitary 30,620 4,268 4,291 25,080 64,259 7,938 3,432 75,629 Middlesbrough Borough Council Unitary 42,620 4,774 3,781 6,748 57,924 15,323 3,352 76,599 Hartlepool Borough Council Unitary 23,588 1,779 5,731 7,815 38,912 10,772 3,211 52,896 Darlington Borough Council Unitary 29,797 972 8,451 9,170 48,389 9,200 6,201 63,791 Durham County Council Disposal 172,671 15,554 28,404 56,467 273,096 15,204 17,680 305,980 Northumberland County Council Disposal 97,729 - 17,930 50,120 165,779 11,237 6,115 183,131 Sunderland City Council Unitary 95,055 11,350 10,267 27,214 143,884 12,229 4,804 160,918 South Tyneside MBC Unitary 44,785 5,195 10,056 15,072 75,108 13,677 4,050 92,836 North Tyneside Council Unitary 60,434 7,938 12,297 21,988 102,657 24,239 7,486 134,381 Newcastle-upon-Tyne City Council MBC Unitary 85,710 16,236 9,167 18,416 129,529 46,818 4,988 181,335 Gateshead MBC Unitary 59,706 15,074 5,819 19,975 100,574 9,706 3,454 113,733 North East Region 808,099 87,095 121,218 271,384 1,287,796 178,507 70,647 1,536,950

Source: WasteDataFlow, Department for Environment, Food and Rural Affairs (Defra), November 2006

Table 3.1.1 above illustrates that the North East region recycled/composted 271 thousand tonnes of household waste and 71 thousand tonnes of non-household waste through municipal sources in the year ending 31/3/06, making a total of 342 thousand tonnes.

Table 3.1.2 below illustrates the make up of the 271 thousand tonnes of recycled/composted household waste. Although wood waste is not singularly identified, it would be included in the ‘Other’ category and also some could be in the ‘Co-Mingled’ category. Hence the upper limit on North East wood recycling from the household waste stream in 05/06 is 28 thousand tonnes. In practice, the quantity would have been lower than this as the category includes other materials such as batteries and WEEE.

It is assumed that any wood waste recycled via municipal sources was collected at Civic Amenity sites or one-off bulk collections and not via kerbside collections.

Table 3.1.2 : Materials ('000 tns) from household sources sent for recycling and composting by local authorities - regional breakdown, 2005/6 North East England Household waste Paper & card 66 24% 1,476 22% Glass 33 12% 759 11% Compost 94 35% 2,439 36% Scrap metals & white goods 20 7% 533 8% Textiles 4 1% 87 1% Cans 5 2% 72 1% Plastics 2 1% 39 1% Co-mingled 19 7% 860 13%

Other 28 10% 532 8%

Total 271 100% 6,798 100% Source: WasteDataFlow, Department for Environment, Food and Rural Affairs (Defra), November 2006

Regional Market Assessment for Wood Waste for North East England 29

NOTES & DEFINITIONS for tables 3.1.1 and 3.1.2: Regular household collection' means wastes within Schedule 1 of the Controlled Waste Regulations 1992. Small amounts of commercial and industrial wastes may also be included in the case of collections that include mixed domestic and commercial hereditaments. Wherever possible, these wastes are included in ‘Non-household sources’. Regular household collection tonnages also include household material which was collected for recycling or composting but rejected as not suitable for recycling, either at collection, during sorting at a Materials Recovery Facility (MRF) or at the gate of the reprocessor.

'Other household sources' refers to Schedule 2 wastes under the Controlled Waste Regulations 1992 ~ those from household sources not collected as part of the ordinary waste collection round service.

'Civic Amenity Sites' refers to household waste collected at sites provided by local authorities for the disposal of excess household and garden waste free of charge, as required by the Refuse Disposal (Amenity) Act 1978. With the introduction of WasteDataFlow, local authorities were given the opportunity to report civic amenity waste in its household and non-household waste components. This was not the case in previous years, where all civic amenity waste was assumed to be household waste. This has resulted in a shift of approximately 250 thousand tonnes of waste in 2004-05 that would previously have been classified as civic amenity household waste into non-household waste. This inconsistency must be taken into account when comparing civic amenity and household waste figures from 2004/05 onwards with previous years.

‘Household recycling' contains materials sent for recycling, composting or reuse by local authorities as well as those collected from household sources by 'private/ voluntary' organisations. 'Non household sources (excl. recycling)' includes any wastes collected by a local authority from non-household sources (i.e. not covered by 'Schedules 1 and 2 of the controlled Waste Regulations 1992). It includes non-household material which was collected for recycling but actually rejected at collection or at the gate of a recycling reprocessor. 'Non household recycling’' includes municipally collected materials for recycling from commercial sources. It excludes material which was collected for recycling from non-household sources but actually rejected at collection or at the gate of a recycling reprocessor.

Table 3.1.3 : Management of Municipal Waste (tonnes), 2005/6

Recycled/ Incineration Incineration RDF Recycled/ Authority Landfill Other Total1 Composted/ with EfW without EfW manufacture composted Authority Type EfW % Stockton-on-Tees Borough Council Unitary 9,432 67,096 - - 19,193 - 95,721 90% Redcar and Cleveland Borough Council Unitary 9,440 37,695 - - 28,512 - 75,647 88% Middlesbrough Borough Council Unitary 20,097 46,402 - - 10,101 - 76,599 74% Hartlepool Borough Council Unitary 9,118 32,748 - - 11,026 6 52,899 83% Darlington Borough Council Unitary 48,427 - 8 - 15,371 - 63,806 24% Durham County Council Disposal 203,213 - - - 74,147 28,620 305,980 24% Northumberland County Council Disposal 124,719 2,177 - - 56,235 - 183,130 32% Sunderland City Council Unitary 128,839 4 - - 32,018 57 160,919 20% South Tyneside MBC Unitary 73,432 - - - 19,122 285 92,840 21% North Tyneside Council Unitary 86,621 18,286 - - 29,474 - 134,381 36% Newcastle-upon-Tyne City Council MBC Unitary 128,590 - - - 23,404 29,327 181,321 13% Gateshead MBC Unitary 90,244 59 2 - 23,429 - 113,733 21% North East Region 932,173 204,467 10 - 342,031 58,295 1,536,976 36% 61% 13% 0.001% 0% 22% 4% 100% Source: WasteDataFlow, Department for Environment, Food and Rural Affairs (Defra), November 2006

Table 3.1.3 indicates that the North East region’s disposal authorities recycled or composted 22% of the waste they disposed of in 05/06 and recovered energy from 13%. The Tees Valley sub-region has the most impressive record on waste recovery (except for Darlington). Overall the region recovered 36% of the municipal waste it disposed of in 05/06.

The official Municipal Waste statistics leave a number of questions unanswered in relation to this study:

1. How much of the 28,000 tonnes of ‘Other’ Household waste sent for recycling/composting was wood? 2. How much of the 19,000 tonnes of ‘Co-mingled’ Household waste sent for recycling/composting was wood? 3. How much of the 71,000 non-household municipal waste which was sent for recycling/composting was wood? 4. How much of the 204,467 tonnes of waste incinerated with energy recovery was wood? 5. How much of the residual 990,478 tonnes of municipal waste was wood?

Regional Market Assessment for Wood Waste for North East England 30

A 2005 survey of Local Authorities by Enviros5 implied that 26,374 tonnes out of a total 260,759 tonnes of Municipal Solid Waste (MSW) separated out for recycling was wood. This equates to 10.1% and if the proportion of wood stays constant as arisings increase would imply that 34,500 tonnes of the recycled/composted MSW in 2005/06 was wood – or that the answers to 1. to 3. above sum to 34,500. The Enviros report also assumes the Waste Not Want Not 2002 Waste Composition study to be the most accurate to date, which implies 5% of all MSW is wood. This would imply that in 05/06 the North East produced 5% * 1,536,976 = around 77,000 tonnes of wood waste in the municipal stream – 34,500 of which was recycled or composted and 42,500 of which was land-filled or incinerated (with or without energy recovery).

The Enviros report also stated that in 04/05, all MSW wood waste sent for recycling was reprocessed within the region, although there was some movement of material between the sub-regions.

Municipal Waste collected at Civic Amenity sites in the North East region is handled by the following waste management companies: „ Premier Waste Management have the contracts for County Durham, Gateshead, South Tyneside, Sunderland and Darlington councils „ Sita have the contracts for Northumberland County, Newcastle City, North Tyneside, Middlesbrough, Redcar and Cleveland, Stockton on Tees and Hartlepool councils. It also manages the joint Sunderland/Gateshead Eco Team CA site project.

All authorities also make one-off bulky waste collections from households and some also have limited commercial collections.

ESYS’ consultations with the 23 Collection Authorities and the two Waste Management Companies in the region provided the following estimates:

„ The two waste management companies reported that the latest available figures for wood collected at Household Waste and Recycling Centres and sent for recycling amounts to 21,161 tonnes per annum. Estimates of how much wood taken to HWRCs ends up in landfill were very vague. In general the opinion that there is ‘at least as much again’ were common, due to the amount of panel products taken to the sites. This would imply in excess of 42 thousand tonnes. The Enviros study estimated 77 thousand tonnes total municipally collected wood waste on a more scientific basis so we will adopt that figure. „ 9 of the 23 authorities reported/ estimated data relating to Bulky Waste collections. These figures were then scaled up based on population:

Table 3.1.4 : Annual Bulky Waste Collections in the North East ANNUAL BULKY WASTE COLLECTIONS: WOOD Population All Wood To Landfill Reprocessed 9 Collection Authorities 1,294,800 6,823 3,766 3,057 50.61% 23 Collection Authorities 2,558,500 13,483 7,442 6,041 45% Source: ESYS Consulting Ltd These estimates varied greatly between local authorities: from 50 to 2300 tonnes of wood collected via bulk collections per annum. The results indicate only 45% of wood collected in bulky waste is recycled. „ Only 3 authorities reported doing any commercial collections. All of these stated they did not know the wood content (but suspected it is small) and that all materials collected from commercial sources by authorities go to landfill.

5 Regional Recyclate Market Development Action Plan by Enviros for ONE NorthEast, May 2006

Regional Market Assessment for Wood Waste for North East England 31

Summarising all this information:

Table 3.1.5 : Annual Municipal Wood Waste

All Wood To Landfill Reprocessed Household Waste & Recycling Centres 63,517 42,356 21,161 Commercial Collections Negligible Negligible Nil Bulky Waste Collections 13,483 7,442 6,041 77,000 49,798 27,202 Source: ESYS Consulting Ltd

Our best revised estimate of annual Municipal Wood Waste is that around 77 thousand tonnes enter the waste stream each year and around 27.2 thousand tonnes are currently recycled. The latter figure is a slight increase on the Enviros 2005 estimate (26.4 ktns), but has not increased in line with the overall Municipal arisings. We are confident in the 27.2 thousand tonne figure as it has been established through a high response survey and feel our estimate and Enviros’ earlier estimate reinforce each other.

3.2 Commercial & Industrial

As reported in the Enviros report (footnote 1), there is a paucity of C&I waste stream data available in the UK. The most up to date data publicly available at a regional level is reported by the Environment Agency from the 2002/03 Commercial & Industrial Survey. However, the Environment agency is in the process of updating this data for 2004. Although the 2004 data has not yet been published, the Environment Agency office in York have allowed us access to the data below.

It should be noted that the method employed by the Environment Agency for deriving the 2004 data was: waste volumes per company were calculated based on the 2002/03 data and totals revised based on National Statistics employment numbers for 2004. There is an underlying assumption that C&I waste arisings per head did not change between 02/03 and 2004.

For comparison purposes, we have put the 02/03 totals alongside the 2004 totals:

Table 3.2.1 - Commercial & Industrial Waste Arisings in the North East - 2004, '000s tonnes 2004 Wood Waste Non-Haz SectorName Durham Northum' berland Tees Valley Tyne & Wear 2004 Totals 02/03 Totals Wood Haz Wood Food, drink and tobacco 76 45 77 137 335 348 4.1 Manufacture of textiles 12 2 6 16 36 34 0.3 Wood and wood products 39 27 39 9 114 109 91.1 0.3 Manufacture of pulp, paper and paper products 21 77 7 45 149 142 1.5 Publishing, printing and recording 5 1 16 39 60 57 0.3 Textiles/Wood/Paper/Publishing 76 107 68 109 360 342 93.2 0.3 Production of coke, oil, gas, electricity, water 8 6 9 17 41 37 0.2 0.0 Manufacture of chemical/plastic/rubber products 76 48 277 105 507 459 8.5 0.0 Other non-metallic mineral products 67 4 11 37 120 108 1.1 Chemicals & Non-metallic minerals 152 59 298 159 668 605 10 0 Manufacture of basic metals 20 20 1482 21 1543 1571 0.7 0.0 Manufacture of fabricated metal products 26 4 47 41 118 120 1.6 Metal Manufacture 46 24 1530 62 1661 1691 2 0 Manufacture of machinery and equipment 32 3 8 26 70 103 2.1 0.7 Manufacture of electrical equipment etc 7 3 4 11 26 38 0.5 Manufacture of motor vehicles & other transport equipment 20 2 15 32 69 101 5.6 0.0 Furniture and other manufacturing 10 2 5 12 29 43 8.5 All Other Manufacturing 68 11 32 82 193 285 16.6 0.7 Retail & Wholesale 105 49 147 254 555 479 12.9 Social work and public administration 18 11 20 36 85 80 0.1 Education 2013283798 93 0.1 Public Sector 38 24 48 73 183 173 00 Hotels, catering 30 21 36 66 154 143 0.1 Transport, storage, communications 20 7 26 42 95 88 4.4 Business & financial services 40 23 65 125 253 234 1.5 Miscellaneous 1414243587 81 0.1 All Other Services 104 65 151 269 589 546 6.1 0.0 Power & Utilities 129 Total 664 385 2351 1145 4545 4598 145 1 Source: Environment Agency, York Office

As can be seen, the region is producing around 4.6 million tonnes of Commercial & Industrial Waste per annum. Around 145 thousand tonnes of this is non-hazardous wood waste, 63% of which is generated by the wood product manufacturing industries. This implies that wood waste makes up around 3.2% of C&I arisings in the

Regional Market Assessment for Wood Waste for North East England 32

North East. This is lower than previous estimates which assumed around 7% of C&I arisings to be wood and put estimates of North East wood waste arisings in the region of 200-322 thousand tonnes per annum. 6

An alternative approach might be to look at the national estimates of C&I wood arisings from the recent study by MEL Research Ltd on behalf of WRAP and pro-rate the estimates attributable to the North East based on the proportion of national employment in the relevant sector(s) based in the region.7

Table 3.2.3 illustrates this exercise: Table 3.2.3 - Estimates of NE Wood Commercial & Industrial SIC 000 Yr of NE UK/ E&W C&I 000 Wood Waste Code(s) tns pa Area estimate employment employment tns pa 36.11- Furniture manufacture 36.14 531 UK 2001 4982 99004 26.72 Panel board mnfg 20.2 1,107 UK 2003 733 5805 139.78 Mnfr construction products 20.3 201 E&W 1998 1,626 40190 8.13 Mnfr packaging 20.4 40 UK 2001 272 6588 1.65 Other C&I wood wastes 20.51 2,552 E&W 1998 405 8455 122.24 Railway sleepers 26 UK 2005 5.10% … base on popn 1.33 Utility poles 23.5 UK 2003 5.10% … base on popn 1.20 4480.5 301.05 Source: ESYS calculated using CEBR; MEL and ONS data. E&W = England & Wales.

This also gives an estimate of around 300,000 tonnes of C&I wood waste being generated in the North East each year. It should be noted that this does not necessarily represent the quantity which can be recovered/recycled as some is already being re-used or incinerated at source for heat/energy and hence not making it in to the waste stream.

Consequently the more conservative estimate of 145 thousand tonnes of North East C&I non-hazardous wood waste per annum will be assumed for this study.

The composition of 2002/2003 C&I waste and its fate are illustrated in table 3.2.2:

Table 3.2.2: C&I Waste in the North East, Disposal & Recovery '000 tonnes Re- Treatment Land Land Not Waste type description used/ Thermal & TOTAL disposal recovery recorded Recycled Transfer Chemicals 265 53 151 51 78 1 599 Metallic 7 - 168 - 1 26 202 Non-metallic 43 - 511 2 5 35 597 Discarded equipment 3 - 11 - 0 1 15 Animal & plant 15 14 119 93 22 16 278 Mixed waste 781 - 32 156 10 38 1,017 Common sludge’s 5 14 7 - 13 2 42 Mineral wastes 764 - 1,080 - 3 1 1,849 Total 1,882 81 2,079 302 134 121 4,599 Source: Environment agency C&I survey 2002/3

Wood C&I waste would be in the ‘Non-metallic’ and ‘Mixed Waste’ categories, although there is no further breakdown of these categories to indicate how much wood waste was disposed of by each route.

6 “The Use of Waste and Recycled Wood For Biomass Energy Generation in the North East of England, 2004” by Bio-Renewables Ltd for the Environmental Industries Federation (EIF) estimated there was up to 800,000 tonnes of wood waste available in the waste stream: 210,000 from the C&I stream, 500,000 from C&D waste and 90,000 from the MSW stream. In addition, the Environment Agency estimated in 2002/03 that wood comprised 7% of industrial waste.

7 WOO0041 - Reference document on the status of wood waste arisings and management in the UK, by MEL Research Ltd on behalf of WRAP, Jun 2005.

Regional Market Assessment for Wood Waste for North East England 33

Our consultations indicate that around 39,000 tonnes per annum are currently being recycled or recovered – around 88% of this is going in to panel board and the remainder in to fuel pellets. Potentially a further 25,000 tonnes a year will be recovered as fuel chips for Wilton 10 and some material may be leaving the area for use elsewhere, but this still leaves up to 81,000 tonnes of non-hazardous C&I waste wood which could be recycled.

3.3 Construction & Demolition

The latest available data for Construction & Demolition waste arisings in the North East is for 2003, as illustrated in table 3.3.1.

Table 3.3.1 North East C&D Waste Streams, % of NE 2003 000 tonnes Total

Sub-total 1: Recycled aggregate and soil 2,607 53.5% Sub-total 2: Material used for landfill engineering or restoration 257 5.3% Sub-total 3: Material used to back-fill quarry voids 811 16.6% Sub-total 4: Material used at Paragraph 9&19 registered exempt sites 844 17.3% 1. Clean, unmixed hard C&D waste disposed of at landfills 48 2. Mixed and/or contaminated hard C&D waste disposed of at landfills 5 3. Clean excavation waste disposed of at landfills 87 4. Mixed and/or contaminated excavation waste disposed of at landfills 62 5. Mixed CDEW and unspecified materials disposed of at landfills 157 Sub-total 5: Material disposed of at landfills 358 7.3% Total 4,877 Source: Capita Symonds

As can be seen, most C&D waste is already re-used, although around 358 thousand tonnes are still landfilled. It is unclear what portion of this is wood waste (old flooring, window frames etc from demolition; off-cuts from construction activities). Wood waste would be contained in above categories 1, 2 and possibly 5, implying an upper limit of 210 thousand tonnes of C&D wood waste currently being landfilled. This is a considerably lower limit than suggested by the Bio-renewables estimate of 500,000 tonnes (see footnote 2).

The Construction Sector is of importance to the region, with major housing renewal projects occurring in Tyne & Wear plus commercial developments in the metropolitan areas. The sector accounts for between 5.8% of all the region’s employment and nearly 6% of England’s Construction sector employment.

MEL Research Ltd (see footnote 5) estimated that C&D wood waste in England was in the range of 1,565 to 6,645 thousand tonnes per annum. Pro-rating this based on the North East’s relative employment in the sector to all England’s, implies that the C&D wood waste in the North East is in the range 94,000 to 398,000 tonnes per annum, as illustrated in table 3.3.2 below. This gives us an average estimate of 246 thousand tonnes of North East C&D wood waste per annum, which is again in the same ballpark as the estimate from Capita Symonds above.

It is not clear how much of the C&D wood waste is presently recycled. The Capita Symonds data suggests that the landfill proportion should be less than 210 thousand tonnes. Hence, we estimate that around 196 thousand tonnes are landfilled and 50 thousand tonnes are recycled. This is also in keeping with the upper limit of MEL’s assumption that 15-20% of all wood arisings are currently recycled.

Regional Market Assessment for Wood Waste for North East England 34

Table 3.3.2 - Estimates of Construction & Demolition England C&D North East England North East Wood Waste, 000 tonnes wood waste C&D wood Construction Construction per annum (03/04) waste Jobs, 2005 Jobs, 2005 Min 1,565 93.73 Max 6,645 397.99 1,029,983 61,689 Average 4,105 245.86 5.99% Source: Calculated by ESYS from WOO0041 & ONS data

3.4 Agricultural

Table 3.4.1 below illustrates the composition and quantity of agricultural waste arisings in the North East. It would appear that wood waste is negligible within the agricultural waste stream. The main possible source of wood waste from this sector would be treated fencing timber.

Table 3.4.1 Agricultural Waste in the North East, tonnes 2002/3 Vegetable plant waste 101,544 Animal matter 1,681,379 Milk 204 Sheep dip 5,448 Plastics/polymers 4,891 Pesticide washings 2,088 Oil 828 Paper & card 475 Rubber/glass 102 Total 1,796,958 Source: Environment Agency

3.5 Arboricultural

Arboricultural wood waste arisings may occur from local authority maintenance of trees and shrubs in public places – street trees, parks and so forth – or from the private sector’s horticultural maintenance.

Neil Harrison, Director of Northwoods, estimates that the region produces some 100,000 tonnes of arboricultural waste per annum, although this is an informed opinion-based estimate rather than a quantitatively derived estimate.

A study on behalf of Northwoods and Newcastle City Council estimated that the Council’s routine tree management operations produce 400-600 tonnes of utilisable hardwood waste per annum8. If this is scaled up on a population basis it would suggest only 3,700-5,555 tonnes per annum for council generated arboricultural waste across the region as a whole per annum. However, Neil Harrison points out that Newcastle has far less green space than other authorities in the region and that the region as a whole has a vast network of tree-lined road and rail sides and private sector houses and gardens.

Bio-Renewables Limited estimated that wood waste from forestry activities (‘brash’ – tops and tails of felled timber) in the region amounts to around 83,000 tonnes per annum.9 If you add this estimate to private sector gardens and council maintenance arisings, it does seem to back Northwoods estimate of 100,000 tonnes, although some more detailed work needs to be carried out to obtain a more robust estimate.

Most arboricultural waste is disposed of at nil cost – chipped and left on site or used elsewhere as mulch. Northwoods believe a little goes to landfill, but there is no evidence as to how much. Forestry activities often leave brash on site as a land leveller, although the biomass boiler at Shotton in North Wales burns forestry brash.

8 A report in to the availability and suitability of the timber resource of Newcastle City Council and an exploration of its possible uses, by Phil Royal for NCC and Northwoods, Aug 2004.

9 The Use of Waste and Recycled Wood for Biomass Energy Generation in the North East of England, 2004, Bio-Renewables Ltd.

Regional Market Assessment for Wood Waste for North East England 35

This type of wood waste is different from the others in that the majority of it is not going to landfill so there is not a diversion incentive to collect and utilise it. Northwoods are encouraging councils to see this waste as an income-potential as opposed to nil cost of disposal.

3.6 Summary of Wood Arisings & Recycling in the North East

Table 3.6.1: Summary of Best Estimates of Wood Waste Arisings in the North East Reprocessed/ Arisings Recovered Landfill Other Municipal 77,000 16% 27,200 49,800 Commercial & Industrial 145,000 31% 39-64,000 81-106,000 Construction & Demolition 246,000 53% 50,000 196,000 Sub-total: 468,000 116-141,200 327-352,000 Arboricultural 100,000 - - 100,000 Agricultural Negligible 568,000 116-141,200 327-352,000 100,000 Source: ESYS

The table above summarises our best estimates of annual wood waste arisings in the North East region. We have estimated roughly that 39,000 tonnes of C&I waste are reprocessed/recovered based on quantities reported in our interviews of the region’s collectors and reprocessors.

We have assigned ‘amber’ status to the figures we feel need further research to reach more robust estimates.

It is interesting to note that the split between municipal, C&I and C&D arisings differs slightly to MEL’s 2005 estimated UK split of 10:42:48%. Also the total tonnage (568 ktns) is less than Bio-Renewables estimate of 799.6 ktns (see footnote 7).

Regional Market Assessment for Wood Waste for North East England 36

4.0 North East Waste Wood Reprocessing

4.1 Egger (UK) Limited

Profile Egger (UK) Limited has panel board manufacturing facilities in Hexham, Northumberland and Barony, Southern Scotland. In addition to being one of the largest customers of waste wood in the region, Egger is itself a major reprocessor. They are the only UK panel board manufacturer with their own full recycling plant.

Chipboard waste is sent to the Barony plant for recycling. Other wood waste goes through the following process: „ A primary electric shredder reduces the material to 50mm size (“grizzly” material). This is the size material comes in from some external reprocessors; „ The “grizzly” material then goes through the recycling plant; „ Contaminants are mechanically removed; „ Fines are removed; „ The material which is left is chipped as per virgin material for use in the product.

The Hexham plant accounts for nearly 10% of the UK’s panel board inputs and produces at the high quality end of the market – boards for furniture & flooring. Consequently there are limits on the proportion of waste wood which can be used. Plants making lower value added products (for instance, construction boards and worktops) can take a greater proportion of recycled feedstock. However, all panel board manufacturers have an interest in using as much waste wood as they can as it reduces energy costs for drying virgin material.

Material Sources Egger Hexham sources its waste wood via a number of channels: „ Egger has its own wood recycling business, Timberpak based in Leeds. The company shares transport routes with Egger’s deliveries to customers from the North East down to Leeds and across the M62 corridor. The company previously handled municipal waste from Leeds, but had quality issues. It does collect commercial wood waste. „ Egger has agreements with a network of thirteen Wood Recyclers (within the region and outside of the region) to provide material. This network is geographically diverse, from the M4 corridor to Edinburgh. „ A little material is delivered direct to Hexham for reprocessing, although this is not actively encouraged as Egger do not want to compete with their own supply network. (In fact material from the neighbouring transfer station goes back to Reivers in Newcastle for reprocessing before being delivered in to the plant).

Although transport costs are a consideration, higher landfill costs in the South East allow for greater gate fees to be charged for material, hence the geographic spread of supplies. The North East has one of the lowest landfill costs in the UK.

As is true of the industry in general, Egger quality stipulations are becoming more stringent. They will only accept packaging; cable drums; timber off cuts; mixed clean wood; untreated flooring; rafters; joists and other clean demolition timber. They cannot handle CCA-treated timber, sleepers, telegraph poles or waste MDF/chipboard. In practice small quantities of MDF/chipboard waste may go through the process but in any quantity the resins present in the waste product will interfere with the new product manufacturing process.

Future Developments Egger Hexham are in the process of installing a brand new conti-board production line, which is due to be live in April 2007. This will replace the two existing lines and give them the capacity to take considerably more waste wood, although this will be built up over a period of 2 years. One of the major improvements of the new plant will be a fully WID-compliant 850 degree C boiler. This will be fuelled by the plant’s waste materials (bark from roundwood inputs, wood fines and sanding dust) giving them a double benefit of an outlet for their fines and the ability to produce process heat for free.

There are no current plans to diversify in to other higher value recycled wood products at the plant. Any excess material is sold on to other panel board manufacturers.

Regional Market Assessment for Wood Waste for North East England 37

Regeneration Impacts Initially the new plant will have little impact on employment levels, but Egger might introduce an apprentice scheme over the next few years.

4.2 UK Wood Recycling Ltd (UKWR)

Profile UKWR Ltd was launched in Spring 2006 at Wilton on Teesside to support the UK's first purpose-built wood burning power station. The business is based at a purpose-built facility next to SembCorp’s Wilton 10 Biomass Power Station.

UKWR received a £240,000 grant from ONE NorthEast and is investing £6 million in the site. The plant will take all grades of non hazardous wood to produce wood chip fuel for the power station - due to be operational by summer 2007, possibly sooner if test firing in early April goes well.

UKWR is contracted to supply up to 80,000 tonnes of wood chip per annum to Wilton 10, which will generate 30 MW of electricity to be supplied to the adjacent industrial sites. This is equivalent to the power used by 30,000 homes in a year. Year one of operation will require 63,000 tonnes with year two seeing the power station up to full capacity.

The wood fuel supplied to Wilton 10 will be engineered to a certain specification before being burned in the boiler. UKWR has installed a rigorous testing and sampling quality system to ensure the specification is met, including an onsite laboratory. Every batch of 350 tonnes is sampled.

Material Sources UKWR will recycle all types of non hazardous wood, including low-grade wood wastes such as panel boards, providing companies and local authorities with an alternative greener and potentially a cost-saving option to landfill.

The plant started to receive wood on site from June 2006. The company’s policy has been to ramp up local supplies gradually so as not to directly compete with existing supply chains (such as those to Egger in Hexham and AW Jenkinson in Carlisle). As only AWJ and UKWR can take grade C waste wood (any non-hazardous wood waste), UKWR hope to redirect existing material from landfill rather than directly compete for existing supplies.

The company has not actively marketed for local supplies to date but relied upon word of mouth and networking. They have a policy of not turning anybody away who has suitable material. The slow build up also enables UKWR to educate suppliers as to what is acceptable material.

Between June 2006 and January 2007 25,000 tonnes of material were stockpiled at the UKWR Wilton site. Initially 95% of material received was transported from Hadfield’s Manchester site and 5% from local sources. The split between out of region/in region supplies is now 80/20%. Eventually there should be two-way traffic between UKWR and Hadfield: grades A&B to Hadfield and grade C to UKWR.

To date local supplies have come via a waste management company responsible for some of the regional municipal waste contracts in the Tees Valley; some local skip hire business and some other commercial and industrial sources.

Future Developments UKWR’s reprocessing site capacity is in excess of 250,000 tonnes per annum, although the current waste management licence permits them to reprocess 200,000 tonnes of waste wood per annum at the site.

The additional capacity in excess of Wilton 10’s requirements may be used to supply other bio-mass/co-firing power stations and for manufacturing higher value products, such as the Hadfield range of animal bedding, growing media and possible sewerage filtration chip.

The UKWR site would require investment in baling equipment before higher-value products could be manufactured but the reprocessing infrastructure already in place is state-of-the-art and the product range could be diversified relatively quickly.

Regional Market Assessment for Wood Waste for North East England 38

Diversification has always been part of the business plan for UKWR and this is anticipated to happen within a three year time frame.

Regeneration Impacts UKWR currently employs 15 people on site and is expected to have the headcount up to 19 by May 2007 and 25 by December 2007. An additional 5 to 15 jobs will be created when the plant increases throughput and diversifies its product range.

UKWR have been recruiting via the local ‘routes to employment’ scheme.

4.3 Reivers Reprocessing Limited

Profile Owner and managing director of Reivers Reprocessing Ltd, Geoff Hornsby, has a background in the quarrying and waste industries. Having noticed a market opportunity for waste wood, Geoff bought the present Reivers site in Gateshead in 1998 jointly with a business associate who now runs a plastics/paper/card recycling business on the other half of the 4 acre site.

Reivers started the open-air wood crushing operation at its Abbotsford Road site in 1999.

The business made a £60,000 loss in its first year of operation but has been profitable ever since. Initially the only competitors in the region were Just Wood (who have since gone out of business) and Premier Waste (who have now sold their wood crushing plant on to Wood Pellet Energy UK).

A number of other smaller players have since entered the North East wood reprocessing market but Reivers remains the largest independent reprocessor except for UKWR Ltd. They have capacity to reprocess in excess of 50,000 tonnes of wood waste a year.

Reivers currently just supply Egger in Hexham. They have supplied other customers previously, such as Nexfor’s panel board plant in Cowie, but transport costs make that uneconomic in the current climate.

They are the only supplier with a contract from Egger. Egger has committed to take all the material Reivers can reprocess. The company uses a Doppstaadt 7 to extract ferrous and non ferrous metals, before crushing the material to produce 50mm material which can then undergo further crushing at Egger’s plant.

Reivers income streams are: gate fees for receiving waste wood; sales income for the reprocessed material from Egger and a share of the PRN income from Egger (currently worth very little).

Material Sources Reivers estimate their inputs to come from municipal, construction and commercial streams as follows:

15% Material from Civic Amenity sites (all Tyne & Wear unitary authorities except North Tyneside) 10% Construction & Demolition waste 50 to 60% Commercial & Industrial packaging waste 15 to 25% Transfer Station waste (including North Tyneside CA waste via Sita) The latter category will also include some packaging waste.

Reivers do not have their own collection infrastructure (vehicles and collection skips) so rely on customers delivering to site and subcontract transport.

Future Developments Reivers do not have any particular expansion plans, but would look to move to a shift system if sufficient material were available to warrant it. The current economic climate is hard for the wood reprocessing industry and the company needs to make its existing plant work harder rather than investing in new sites/equipment.

The site does constrain the company’s ability to expand the scale of its operation– they currently rent adjacent land for storage, but this land could be developed in the future, thus reducing the amount of material the business can store at any one time.

Regional Market Assessment for Wood Waste for North East England 39

Regeneration Impacts Reivers employs 6 to 7 full time equivalent staff. This would increase if the business moved to shift working.

4.4 Wood Pellet Energy UK/Premier Waste

Profile Until around a year ago Premier Waste Management Limited operated a subsidiary, Premier Environmental Products, which produced fuel pellets from wood waste for domestic and light industrial use, including fuelling Durham Trinity Schools’ biomass boiler.

However, Premier have concentrated their environmental efforts in to aerobic digestion systems and sold their wood crushing and pelletising plant on to Kevin Owens, previously their wood reprocessing operations manager. Kevin has set up a new business – Wood Pellet Energy UK (WPEU) – and is honouring all the contracts Premier had in place to take waste wood.

WPEU operated from Premier’s Durham site initially but moved to its own site at Chilton, near Darlington in January 2007.

Despite the company’s name, WPEU also supply Egger. Around 40% of output goes to Egger and 60% is manufactured in to fuel pellets supplied to around ten small scale biomass boilers in Durham and Northumberland Counties.

WPEU’s wood pellets are currently sold for £85-100 per tonne, depending upon the order size.

Material Sources WPEU get most of their material from Premier’s Civic Amenity site contracts with Durham County and Darlington Unitary Councils and Premier’s contracts for construction and demolition/ commercial and industrial wood waste via waste collection bins and skip companies. WPEU take the gate fee which would previously have gone to Premier.

Whilst at Premier Kevin Owens had available material in the Durham area surveyed and managed to increase the volume of C&I and C&D waste wood diverted from landfill and increased the company’s throughput from 1500 tonnes per month to 2500 tonnes per month, although WPEU is currently operating at a rate of around 1000- 1050 tonnes per month.

Current inputs can be broken down roughly as follows: „ 40% softwoods from CA sites „ 40% commercial & industrial packaging waste „ 10% clean wood waste from construction and demolition „ 10% panel board waste from CA sites

At present only the first three categories are reprocessed. The panel waste used to be shipped to Slough Heat and Power to be used as wood ship fuel but transport costs have now made that economically unviable. This material, of course, could be redirected to Wilton or Lockerbie.

Future Developments WPEU hope to invest in a second pellet mill during 2007 which will raise their processing capacity to 2000 tonnes a month.

Kevin Owen is particularly interested in further research work to identify quantities of useful wood waste currently going to landfill.

Regeneration Impacts Initially WPEU employs 6 staff but it is hoped this will rise to 12 to 15 in the next year with a second production line in the pipeline.

Regional Market Assessment for Wood Waste for North East England 40

4.5 Thompsons of Prudhoe

Profile Thompsons of Prudhoe originally quarried lime for agricultural use but have diversified over time. They have sites in County Durham, Northumberland, Tyne and Wear and Cumbria. These house four quarries, 4 waste disposal and landfill sites and three recycling centres/ transfer stations. They also operate a demolition contracting arm.

All wood waste retrieved by Thompsons ends up at Egger’s panel board facility in Hexham – some directly and some via Reivers.

Material Sources Nearly all the waste wood handled by Thompsons is from Commercial and Industrial or Construction and Demolition sources.

Future Developments Currently any material not fit for Egger is landfilled. However, the company is looking at the possibility of installing a biomass boiler on site to a) reduce materials going to landfill and b) reduce their £10,000 quarterly energy bills.

They also believe some lower quality material will start going to UKWR in Teesside, but presently this is not economic for them: their landfill costs are marginally cheaper than paying transport and UKWR gate fees. This will change as landfill tax rises. Thompson have their own landfill sites so only pay the tax, not a landfill gate fee.

Regeneration Impacts The company is still family owned and managed and employs 330 staff. It is presumed any changes to how they process waste wood would not impact their employment level.

4.6 SWS Recycling Limited

Profile Hartlepool-based SWS commenced trading in 1961 from its premises in Hartlepool.

SWS operate a recycling collection service in the region and a licensed recycling transfer station with a material recycling facility (MRF). They also have their own licensed landfill to accept residues and they operate a packaging compliance scheme.

Material Sources SWS operate mainly in the business sector but do take some Civic Amenity site material.

In 2006 around 17% of the waste wood it took in was packaging from the commercial and industrial waste stream – pallets, packing cases, cable drums and packing supports. A small proportion of this was sent back to pallet companies for reuse.

The remaining 83% was mixed wood waste from the construction and demolition/ CA site streams. Around a third of this was sold on to Egger and the rest was landfilled.

Future Developments With around 75% of the wood waste SWS take in currently going to landfill, there is obviously potential to divert more to other uses, particularly given that UKWR are in the same sub-region.

Like Thompsons, for SWS it is currently more economic for them to landfill wood waste which Egger can not take instead of paying UKWR’s gate fee and transport costs. This will change with the increase in landfill tax.

Regional Market Assessment for Wood Waste for North East England 41

4.7 Alex Smiles Ltd

Profile Sunderland-based Alex Smiles is a family run business with a number of waste-related services including: „ MRF and Transfer Station facilities; „ Skip and plant hire; „ Hazardous waste disposal; „ Bulk waste collection and disposal; „ Secondary aggregates.

Material Sources The company recycles wood waste from its local authority bulk waste collection (on behalf of Gateshead Council) and construction and demolition waste services.

Clean grade material is shredded to 50mm and sold on to AWJenkinsons in Carlisle. (AWJ pay for the material and provide a transport deal). Some is sent to Egger via Reivers.

Like many of the other smaller players spoken to, it is currently more economic for them to landfill the lower grade material than pass it on for energy markets.

Future Developments Initially AWJ wanted non-shredded material from the company in order to prove the material quality. As they are now assured of the material quality, Smiles are shredding the material it ships over to Carlisle. Consequently they will be able to send double the volume they sent last year, diverting more from landfill.

They also believe they will have a commercial biomass boiler opening nearby which will take some of their lower grade material and as landfill tax rises, it might be more economic to send material to Wilton or Lockerbie for energy.

Smiles may also look at buying equipment which will allow them to separate fabric and wood components from furnishings collected as bulky waste. This will enable more wood to be retrieved.

Regeneration Impacts The company employs 70 staff.

4.8 Holystone Ltd Holystone are based in Wallsend, Tyne and Wear. They originally specialised in road construction and civil drainage but have diversified into waste management.

They have three recycling centres – at Wallsden, Washington & Callerton near Newcastle – and a landfill site.

Holystone – like Alex Smiles – does bulky waste collections on behalf of Newcastle and Gateshead. The material is sold on to AWJenkinson in Carlisle.

4.9 Other North East Wood Recyclers/ Reprocessors

A number of smaller players have C&I/ C&D wood collection operations, including: „ Tony Shepherd; „ Evergreen of Darlington, a pallet manufacturing and repair business which also collects & chips waste wood; „ JB Ltd; „ Scott Brothers; „ Impetus Group; „ ALAB environmental; „ Newcomb & Sons Ltd; „ Biffa;

Regional Market Assessment for Wood Waste for North East England 42

„ North East Furniture recycling schemes; „ Acorn Recycled Timbers (planning to manufacture kitchen worktops from waste wood); „ JWS of Middlesbrough, whom NISP have been instrumental in getting 10ktns pa redirected to UKWR; „ Sita, whom NISP have been instrumental in getting 10ktns pa redirected to UKWR; „ John Wade , whom NISP have been instrumental in getting ad hoc quantities redirected to UKWR.

Regional Market Assessment for Wood Waste for North East England 43

5.0 Competing Materials

5.1 Forestry

5.1.1 The Forestry Industry in Great Britain

The Centre for Economics and Business Research Ltd (CEBR) estimate that forestry industries in the UK were responsible for supporting 2.5 per cent of the UK economy in 2005 through their direct and indirect operations. A total of 727,000 UK jobs were supported and £26.4 billion worth of gross value added was generated by the direct and indirect operations of the industries. These can be summarised as follows:

Table 5.1.1.1 – Contribution of Forestry Industries to the UK Economy, 2005 Sector Jobs ‘000s Gross Value Added % of UK Economy £billion Forestry & logging 10 0.342 0.03 Manufacturing wood products 80 2.900 0.28 Pulp, Paper & Paperboard 17 1.100 0.11 production Manufacturing paper/ 60 2.900 0.28 paperboard products TOTAL DIRECT: 167 7.242 0.70

Indirect/ Multiplier Effects 560 19.200 1.80

TOTAL DIRECT & 727 26.442 2.50 INDIRECT Source: Derived from CEBR Ltd “The economic contribution of the forest industries to the UK economy” June 2006

If there were a developed biomass industry in the UK it could help the forestry industries to support an additional 59,000 UK jobs.

As well as the economic activity generated by the industries, the existence and maintenance of the UK’s forests and woodlands generates significant positive impacts on society and the environment – a role which is likely to become more prominent as environmental concerns grow and more natural sources of energy are sought. Some of the key non-market benefits of forests and woodland include: biodiversity; the promotion of health; scope for a wide range of recreational activities; and carbon sequestration.10

As of March 2006 there was 2.7 million hectares of woodland in Great Britain, covering around 12% of the land mass. This compares to woodland coverage in the EU as a whole of 37%. 11

Table 5.1.1.2 – Woodland in Great Britain in 2006 ‘000 hectares Conifers Broadleaves All Woodland Forestry Commission England 151 53 204 Wales 95 12 108 Scotland 433 27 460 Great Britain 679 92 772 Non-Forestry Commission England 217 701 918 Wales 64 113 178 Scotland 615 261 876 Great Britain 896 1075 1972

10 The economic contribution of the forest industries to the UK economy, CEBR Ltd, for Confor and the Forestry Commission, June 2006

11 FORESTRY FACTS & FIGURES 2006 - A Summary of Statistics About Woodland & Forestry, the Forestry Commission

Regional Market Assessment for Wood Waste for North East England 44

All Woodland England 368 754 1121 Wales 160 126 285 Scotland 1049 288 1337 Great Britain 1576 1167 2743 Source: FORESTRY FACTS & FIGURES 2006 - A Summary of Statistics About Woodland & Forestry

0.8% of this area was newly planted/ re-stocked in 2006. New planting levels are less than 25% of the level from 25 years ago, whereas restocking levels have increased by around 50% in the same time period.

UK wood production (or harvesting) has been rising gradually and reached around 22 thousand cubic metres in 2005 (inclusive of bark) – 25% Forestry Commission conifers, 23% non-forestry commission conifers and 52% broadleave. A cubic metre of softwood equates to around 0.82 tonnes and a cubic metre of hardwood equates to around 0.90 tonnes when freshly felled.

Use of UK grown timber has been gradually growing as illustrated in the table below:

Table 5.1.1.3 – How UK Grown Timber Was Used, 2001-2005: ‘000 green tonnes

Source: FORESTRY FACTS & FIGURES 2006 - A Summary of Statistics About Woodland & Forestry

Imports of timber have also risen gradually – from 16.9 million m3 in 2001 to 20 million m3 in 2005.

5.1.2 The Forestry Industry in the North East Region

The North East region has in excess off 100 thousand hectares of woodland, covering some 12% of its land mass. This equates to over 9% of England’s woodland. Conifer woodland is the dominant forest type representing 64.5% of all woodland in the region. Broadleaved woodland represents 21.1%, mixed woodland 5.1% and open space within woodlands 4.2%.

The main conifer species is Sitka spruce covering 43,347 hectares or 63% of all conifer species. The main broadleaved species is oak covering 4,966 hectares or 20% of all broadleaved species. The area of broadleaves increased by 51% between 1980 and 1999, with the relative proportion of broadleaves to conifer increasing from 18% to 26%. The coniferous nature of the North East’s woodland means it has more in common with the Scottish forestry industry than the rest of England.

51,480 hectares or 51% of woodland over 2 hectares is owned by or leased to the Forestry Commission, and 49,374 hectares or 49% of woodland is under other ownerships. There are 3,332 woods over 2 hectares within North East Region with a mean wood area of 30.5 hectares. There are a total of 1,636 woods from 0.1 – <2.0 hectares with a mean wood area of 1.2 hectares.

Regional Market Assessment for Wood Waste for North East England 45

Table 5.1.2.1 – North East Woodland, 1998

Source: National Inventory of Woodland & Trees - Regional Report for North East England, the Forestry Commission 2002

Northumberland has the highest predominance of woodland – with Kielder Forest accounting for around half of the whole region’s woodland.

Table 5.1.2.2 - Estimate of the Economic Value of North North East UK East Forestry Industries GVA GVA Jobs Jobs 2005 Direct Employment: £bn £bn 02 : Forestry, logging and related service activities 169 0.006 10,000 0.342 20 : Manufacture of wood and products of wood 3,532 0.128 80,000 2.900 21 : Manufacture of pulp, paper and paper products 4,126 0.214 77,000 4.000 Total 7,827 0.348 167,000 7.242 4.69% 4.81% 2005 In-direct Employment: 02 : Forestry, logging and related service activities 270 0.009 16,000 0.5 20 : Manufacture of wood and products of wood 7859 0.278 178,000 6.3 21 : Manufacture of pulp, paper and paper products 19612 0.664 366,000 12.4 Total 27,741 0.952 560,000 19.2 4.95% 4.95% DIRECT & IN-DIRECT EMPLOYMENT: 35,568 1.300 727,000 26.483 Source: ONS 2005 & CEBR:"The economic contribution of the forest industries to the UK economy", June 2006

Table 5.1.2.2 estimates the value of Forestry Industries – direct and indirect – to the North East’s economy. It can be seen that the impact amounts to over 35 thousand jobs and £1.3 billion gross value added. This is equivalent to around 3% of the region’s employment and 4% of its GVA.

CEBR (footnote 5) estimated that if there were a developed biomass industry in the UK, this could help the forest industries to support an additional 59,000 UK jobs. On a pro-rata basis we estimate that 2,887 of them would be in the North East. This excludes additional jobs in the wood recycling and fuel crops industries supported by biomass expansion.

Figure 5.1.2.1 below illustrates that over the past century, England has become more wooded:

Regional Market Assessment for Wood Waste for North East England 46

Figure 5.1.2.1 – Percentage of English Woodland Cover, 1895, 1947 and 1998

Source: National Inventory of Woodland & Trees - Regional Report for North East England, the Forestry Commission 2002

In particular, the North East region has seen a dramatic rise: the northern part of the region has increased its woodland coverage from less than 4% to between 14 and 16%, whilst the southern part of the region has increased less dramatically from less than 6% to between 6 and 8%.

Table 5.1.2.3 shows that whilst the region has only 5% of the country’s population, it has nearly 3.5% of the country’s forestry employment. It has 6.6% of the country’s land mass but 9.2% of the country’s woodland.

Table 5.1.2.3 – Comparison of Forestry North East % of Employment in England & the North East England North East England 2005 Mid-Year Population 50,431,700 2,558,500 5.1% Land Area Square KMs 130,395 8,592 6.6% Woodland, hectares 1,121,000 (2006) 102,867 (1998) 9.2% All Jobs (ONS 2004 ABI) 22,565,310 1,002,487 4.4% 020 Forestry & Related Jobs (ONS 2005 ABI) 4,875 169 3.5% % Forestry Jobs of All Jobs 0.02% 0.03% 131.9%

Hence, we can see that commercial forestry is important within the region but it does not necessarily follow that there is greater regional competition for virgin timber than for recycled wood feedstock.

5.1.3 Supply and Demand for Forestry Products in the North East Region

The region produces around 700 thousand cubic metres of timber – predominantly soft wood – per annum. (This is equivalent to between 575 and 700 thousand tonnes). Regional sawmill demand for timber is around 400 thousand cubic metres per annum.12

However, the type of supply in the region does not necessarily match the demand, as illustrated below:

12 Brendan Callaghan, The Forestry Commission – North East Conservancy

Regional Market Assessment for Wood Waste for North East England 47

Table 5.1.3.1 – North East Supply and Demand for Forestry Timber Market Type of Timber Current Amount Destination/ Price per tonne per annum Source North East Supply 700 k m3 Sawmills making Red logs 175 k m3 In the region £25-30, incl. fencing; pallets etc transport “Pallet Logs” 70 – 105 k m3 In the region £20-25, incl. (smaller, cheaper) transport Sawmills making Green logs 175 k m3 UK – out of region £30-35, own construction timbers collection “carcassing mills” Paper mills Spruce only – } Paper mills, £26-28, incl. roundwood logs } Scotland & Finland transport Panel Board Roundwood logs } 245 – 280 k m3 In the region ~£18 incl. transport } (£0 profit) Energy Roundwood logs } In the region Pay as needed – } ROCS subsidise } price Animal Bedding Roundwood logs In the region Pay as needed North East Over 665 k m3 Demand Egger - Panel Board Roundwood logs 135 ktns (~165 Kielder; Scotland; Round wood & km3) North Yorkshire ‘standing sale’ contracts with the FC SembCorp Roundwood logs 80 ktns (~98 km3) N.Yorks; in region Contracts with FC & UPM- Kymmene Sawmills Red/ Pallet logs 400 k m3 In & out of region Source: ESYS consultations

The end markets and prices for roundwood supplies depend on the size and quality of the log. SembCorp and Lockerbie biomass power stations will add around 140-160 ktns of demand in Northern England for material. Plans to co-fire at Drax power station in North Yorkshire could add up to 1-2 million tonnes per annum demand.

Transport costs do not have the economic impact that might be anticipated: it costs around £40 per hour for a lorry which will carry 26-30 tonnes of timber (£1.33 per tonne per hour). It is actually loading and unloading costs which are relatively high – hence once the timber is on the vehicle, distance travelled makes only a marginal difference.

Timber prices themselves have increased dramatically on world markets – European prices rose by more than 50% in the summer of 2006. They are expected to rise a further £5 per tonne in quarter 1 of 2007, with increased timber demand from the east rather than west. The pressures on demand for virgin material should bode well for recycled materials.

The Forestry Commission are about to publish a Wood Fuel Strategy for the UK. The Commission’s stance is that higher value markets should be served first but that timber of no use to existing markets should go to energy. They want to see increases in the wood fuel sector, predominantly from smaller scale projects. Currently there is believed to be 2 million tonnes of timber in the UK per annum which is not managed/ harvested as it is uneconomic. The energy market could change this. The North East’s share of this un-harvested material is believed to be around 300 ktns per annum.

There has been much recent concern that previous estimates of wood availability have been over-optimistic and that all the new interest in the wood energy sector could lead to shortages, as expressed by John Clegg Consulting13:

13 Forecast Wood Availability & Demand in Scotland & Northern England to 2016, John Clegg Consulting Ltd, on behalf of the Wood Fibre Processing & Supply Industry, Nov 2006

Regional Market Assessment for Wood Waste for North East England 48

“…over the last few years there have been a number of formally and informally announced plans for further new investments in the forest industry and in the development of new large and small scale wood fired energy plants in Scotland and Northern England. At the same time there were indications that the 2005 twenty year forecast of the potential availability of coniferous roundwood in Scotland and Northern England might be significantly lower than previously indicated. With these developments, and continuing enquiries from larger businesses interested in installing wood fired electricity generating and heating systems, it became apparent to leading wood fibre processing and supply companies that over the next ten years there would be a significant tightening in the balance between wood fibre demand and the potential availability with the serious possibility of moving into a wood fibre deficit in Scotland and Northern England. If the supply and demand balance became very tight it could have potentially serious financial and economic consequences for the existing wood processing industry; for new investments in both the forest and wood energy companies and strategically in the longer term for the management of woodlands and the establishment of new ones.”

The John Clegg report concluded that forecast demand for wood fibre will exceed the potential availability in Scotland and Northern England from 2007 to 2016, excluding the possible use of wood fibre for co-firing. In some cases the shortfall is very significant. This potential deficit will occur with both coniferous roundwood and sawmill co-products. The use of roundwood from local woodlands for heating individual domestic and public buildings is not expected to have any significant impact on the overall demand for wood fibre over the next 10 years.

Figure 5.1.3.1 illustrates the extent of demand exceeding supply by forestry product type:

Figure 5.1.3.1 - Demand as a Percentage of Supply for Forestry Products in Scotland & Northern England

200% SRW 7-16cm 180%

160% Saw logs greater than 16cm 140% Saw mill co products 120% Coniferous round w ood 100%

80% All Forestry Products

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Source: Derived from data in the John Clegg Consulting report (see footnote 7)

It can be seen that all types of forestry product have demand which outstrips supply already. The gap is set to widen further by 2016, with the biggest discrepancies being for small round wood (diameter 7 to 16cm) and sawmill co-products.

The shortfall of supply for all forestry products in Scotland and Northern England is currently around 1.4 million green tonnes, rising to 6.6 million green tonnes by 2016 (without any intervention):

Regional Market Assessment for Wood Waste for North East England 49

Table 5.1.3.2 – Excess Demand Over Supply of Forestry Products in Scotland & Northern England Demand less Supply, Green Tonnes 2007 2012 2016 SRW 7-16cm 93,200 2,474,200 2,286,800 Saw logs greater than 16cm 191,059 737,292 389,392 Sawmill co products 709,854 1,787,327 1,722,382 Coniferous round wood 365,259 2,872,392 2,186,592 All Forestry Products 1,359,372 7,871,211 6,585,166 Source: Derived from data in the John Clegg Consulting report (see footnote 8)

It can be seen that the increase in demand from Forestry Industries alone causes a significant divergence between supply and demand, exacerbated even further by new demand from the energy sector:

Figure 5.1.3.2 - Demand for Forestry Products vs Supply in Scotland & Northern England, Millions of Green Tonnes per Annum

28

26 Supply 24

22 Forestry Industries 20 Demand Forestry Industries & 18 Energy Demand 16

14 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Source: Derived from data in the John Clegg Consulting report (see footnote 8)

Although these figures cover a much wider geographical area than just the North East, the implications are the same: that demand for forestry products is expected to outstrip supply this year and increasingly so to 2016, without intervention.

This means there is a good market in the North East for exploring alternatives to virgin timber and sawmill co- products – such as arboricultural wood and waste wood.

However, it should also be noted that the Forestry Industries are likely to respond to the predicted shortfalls in supply, seeing this as an opportunity to increase replanting programmes and investigate managing/ harvesting woodland which was previously deemed un-economic.

There are also moves to recoup economic value from the ‘tops and tails’ or brash, leftover from timber harvesting and previously left on the ground. The Shotton Biomass project in North Wales is trialling a brash baler and converting the material to fuel.

5.2 Sawmill Co-Products

Quality logs sent to sawmills typically have the following yields:

„ 55 to 60% of the weight becomes sawn panels „ Around 35% of the weight is lost in bark/ small edge pieces left after the panels have been cut. This material is typically in the form of chips or shavings. „ 5 to 10% of the weight becomes saw dust.

Saw dust is a premium product as it can only be produced as a co-product of sawmill activities and is in demand from animal bedding and panel board manufacturers. The latter use it for coating boards.

Regional Market Assessment for Wood Waste for North East England 50

Bark chippings almost exclusively go to the horticultural sector, as do some wood chips. Wood chips and shavings go to industries such as animal bedding and energy.

Sawmill co-products are seen as products in their own right with commercial value. If viewed as waste products they would become subject to waste licensing legislation.

5.2.1 Supply and Demand of Sawmill Co-products in the North East

The North East has some 43 workplaces, employing around 495 people in activities of sawmilling, planing and impregnation of wood (source: ONS 2005 ABI data, SIC 201). This represents around 6% of England’s workplaces and 6.8% of its jobs in this sector.

Around a fifth of the jobs are based at 35 micro workplaces, employing 3 people each on average. A further 8 workplaces employ around 50 staff each. It is obviously easier to collect co-products in the volumes generated by these small/medium businesses than by the micro businesses.

Table 5.2.1.1 – Supply & Demand for Sawmill Co-products, Scotland & Northern England, 2007 to 2016 (green tonnes) 2007 2012 2016 Supply 1,835,732 2,281,589 2,370,885 Forestry Industries Demand 2,210,586 3,543,916 3,568,267 Energy Demand 335,000 525,000 525,000 Total Demand 2,545,586 4,068,916 4,093,267 Regional Shortfall in Supply 709,854 1,787,327 1,722,382 Source: Derived from data in the John Clegg Consulting report (see footnote 8)

Table 5.2.1.1 illustrates that across Scotland and Northern England, there is a shortfall in the availability of sawmill co products in the region of 700 thousand green tonnes and this is expected to rise to 1.7 million green tonnes by 2016.

As the North East represents about 10% of the sawmill employment in this larger region (North West: 27%; Yorkshire and Humberside: 23%; Scotland: 40%), one might expect that the supply of sawmill co products is in proportion. That is that the North East currently supplies around 184 thousand green tonnes of sawmill co products and this is expected to rise to 237 thousand green tonnes by 2016:

Table 5.2.1.2 – Estimated Supply of Sawmill Co-products, Scotland & Northern England, 2007 to 2016 (000 green tonnes) Empt 2007 2012 2016 North East 10% 184 228 237 North West 27% 496 616 641 Yorkshire & Humberside 23% 422 525 546 Scotland 40% 734 913 949 TOTAL 100% 1,836 2,282 2,373

The demand is unlikely to be in proportion to sawmill employment. Demand within the region which we know of from consultations for this study amounts to some 235-240 thousand tonnes per annum currently, rising to 265- 270 thousand tonnes by 2009. Implying the North East currently has about 9% of the demand detailed in table 5.2.1.1 above. Hence the region is a net importer of sawmill co products.

5.2.2 North East Sawmills

The two largest sawmills in the region are A&J Scott in Alnwick and Taylormade Timber Products in Durham.

Taylormade are the second largest saw mill in England and process 5,000 tonnes of logs a week, resulting in around 2,850 tonnes of timber, 2,000 tonnes of chippings and saw dust (which all goes to Egger) and 150 tonnes of bark chippings which are sold to a Norwich producer of landscaping mulch. The company employs 80 staff.

Regional Market Assessment for Wood Waste for North East England 51

AJ Scott state on their web site that with new plant in situ, they are gearing up to a volume of 2,000 cubic metres of timber per annum. They employ over 100 staff. All their co-products are sold in to the panel board industry (presumed to be Egger).

Assuming that 1 cubic metre = 0.82 green tonnes of timber, thatAJ Scott’s product breakdown is in the same proportion as Taylormade and that the saw mills operate a 48 week year, these two companies alone account for: „ 180+ employees: „ 263 thousand m3 or 216 thousand tonnes of sawn timber per annum: „ 11 thousand tonnes of bark per annum, going to the landscaping industry: „ 151 thousand tonnes of wood chip and saw dust per annum, going to the panel board industry.

We estimate there are around another 41 saw mill businesses in the region, employing on average less than 8 persons each. The two major players have confirmed there are no other saw mills in the region processing any significant volumes. Other micro saw-milling businesses in the region include:

Company Town County Ward Timber Ltd Bishop Auckland County Durham G Carr Timber Alnwick Northumberland Ford & Etal Estates Coldstream Berwickshire Healey Sawmill Riding Mill Northumberland Beechwood Alnwick Northumberland Hulne Park Sawmills Alnwick Northumberland Stan Dawson Ltd Newcastle Upon Tyne Tyne and Wear D Troup Morpeth Northumberland Harelaw Sawmill Stanley County Durham Horn's Sawmill & D.I.Y Durham County Durham Bothal Sawmills Morpeth Northumberland Sleekburn Sawmill Bedlington Northumberland Waggott Bros Durham County Durham Etchells Sawmills Houghton Le Spring Tyne and Wear

On a pure pro-rata basis, we could estimate the total North East saw mill output by multiplying the outputs for AJ Scott and Taylormade by the total regional industry’s employment divided by the employment in these two companies, [495/180]. However, as none of the other companies will enjoy the same economies of scale, this is likely to be a significant over estimate. Hence the estimates below are illustrative only and represent extreme upper limits for what the entire saw milling industry in the North East contribute:

„ 495 employees; „ Less than 594 thousand tonnes of sawn timber per annum; „ Less than 30 thousand tonnes of bark per annum; „ Less than 415 thousand tonnes of wood chip and saw dust per annum.

These figures are in the right ‘ball park’ compared to the John Clegg estimate of 1.8 million tonnes of saw mill co products for the whole of Scotland and Northern England in 2007.

5.3 Arboricultural Arisings

As stated in chapter 3, the best estimate of arboricultural arisings in the region is 80,000-100,000 tonnes of per annum, but this is opinion-based rather than scientifically based.

Northwoods are the most active body in the region exploring projects to utilise arboricultural arisings in a more commercial manner.

With funding from Newcastle City Council, the Forestry Commission, Great North Forest and its own resources, the organisation undertook a resource study which looked at the utilisation of arboriculture arisings from across Newcastle. They concluded that with half a million trees and 182 hectares of woodland of one sort or another,

Regional Market Assessment for Wood Waste for North East England 52

the city possesses a considerable resource, which, if exploited for energy end-uses, could significantly reduce the Council's waste disposal bill, reduce carbon dioxide emissions and create jobs.

The study14 found that Newcastle City Council produces between 400 and 600 tonnes of utilisable hardwood woodchip and timber from its routine tree management operations. Neighbourhood Services at present disposes of these arisings at nil or close to nil cost, via a variety of channels, mainly to internal markets, including using woodchip as an horticultural mulch and larger pieces as firewood. Most of the arboricultural arisings are chipped to waste, but a proportion is taken to Parks and Countryside Training for disposal there.

The report recommended that the Council built partnerships with other organisations with the aim of establishing a market for useable wood fuel chips. It argued that this potential heating market could be satisfied from arboricultural arisings material if the Neighbourhood Services department invested in some training and development of its wood utilisation systems. The report argued that selling woodchip to an internal market represents the largest financial return per tonne and also the most ethical, efficient and environmentally sound way of using this material. Processing operations for such a venture would also add employment opportunities.

Neil Harrison of Northwoods believes that an operation which turns arboricultural arisings in to fuel chips of no greater than 30% moisture and which have had contaminants screened out, would attract revenues of £50 to £60 per tonne. However, a full business plan/ cost benefit analysis of such a venture in the region has not been carried out to date. The South East have explored this option in greater detail, with the Bio-Regional report in to Croydon’s tree surgery arisings.15

BioRegional, Croydon Council and City Suburban Tree Surgeons established a Tree Station to produce 10,000 tonnes a year of high quality woodchip fuel from tree surgery arisings. Woodchip suitable for use in all woodchip boilers is made.

The Tree Station is the first of its type in London and was set up to: „ provide a sustainable means of disposal for tree waste; „ support Croydon Council’s renewable energy policy; „ stimulate the development of a local biomass heating market; „ provide a new business opportunity locally; and „ act as a demonstration site.

The project was a winner at the 2006 Ashden Awards for Sustainable Energy.

The study calculated approximate capital costs of creating new Tree Stations of a similar size to be around £232,500 - £66,000 for buildings and £166,500 for equipment (second hand). The operation of the plant is not in itself profitable as most of the chip goes to larger players, such as Slough Heat and Power, at around £21 per tonne (inclusive of a £10 gate fee charged. However, Croydon Council pass a £22/tonne share of their gate fee from private sector tree surgery on to the Tree Station, allowing them to make a small profit (around £1000 a month in the first year). BioRegional believe long term success depends on smaller biomass installations, where wood chip price can be aligned to equivalent gas prices. It is this end of the market which Northwoods presume would give revenues of £50-60 per tonne.

Northwoods have put a bid in for BREW funding to start up a similar Tree Station in the North east, but were not successful. It would seem there is much to be learnt from the Croydon experience and considerable business planning and cost benefit analysis to be undertaken before it would be sensible to invest in such a venture. It also needs to be borne in mind that much arboricultural waste is being disposed of at nil cost – being used as mulch or chipped and left in situ. Consequently any public investment in this area would not see any appreciable diversion from landfill, although it could help meet sustainable energy and (limited) regeneration objectives.

14 A report into the availability and suitability of the timber resource of Newcastle City Council and an exploration of its possible uses, By Phil Royal for NCC & Northwoods, Aug 2004

15 Woodchip Production from Tree Surgery Arisings in Croydon, by Bio Regional for the Carbon Trust, 2006.

Regional Market Assessment for Wood Waste for North East England 53

Saw mills and high-value wood product manufacturers are not interested in arboricultural arisings as the quality can not be guaranteed – the timber has not been grown under controlled circumstances and its exposure in public spaces means it can be contaminated with particles of glass, grit etc.. It is possible that UK Wood Recycling might take some arboricultural arisings although this would be for a gate fee (around £25/ tonne).

Further detailed work is required to investigate whether Tree Stations in the North East are viable options compared to the alternatives of a) disposing of arboricultural arisings as now by chipping them and leaving them in situ/ using them as mulch or b) paying a gate fee to dispose of them to a larger venture such as UK Recycled Wood.

Regional Market Assessment for Wood Waste for North East England 54

6.0 End Markets

6.1 Panel Board Industry

The Panel Board Industry in the UK

The Panel Board industry has traditionally been the largest end market for waste wood in the UK. Figure 6.1.1 illustrates that the proportion of recycled feedstock has grown significantly in the past decade, reflecting increasing virgin wood prices, reducing waste wood prices and the relatively higher energy costs to dry virgin wood.

Feedstock for the 8 UK-based panel board plants in 2005 comprised: 1.504 million tonnes of round wood (35%); 1.043 million tonnes of waste wood (24%) and 1.734 million tonnes of sawmill co-products (41%). The industry currently accounts for around 75% of the clean recycled wood used in the UK (Source: WPIF).

Figure 6.1.1 – Wood Usage in UK Manufactured Panel Products

Woodbased Panel Products - Wood Usage

5000 4500 4000 3500 3000 2500 2000

(000) Tonnes (000) 1500 1000 500 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

Small Roundwood (tonnes) Sawmill Co-products (Tonnes) Recycled Wood (tonnes)

Source: Wood Panel Industry Federation

The industry in the UK is dominated by four multinational manufacturers:

„ Egger (UK) Ltd, with plants in Hexham and Barony (Southern Scotland); „ Kronsopan Ltd, with a plant in Chirk, North Wales; „ Norbord Ltd, with 1 plant in Devon and 2 in Scotland; „ Sonae Tafibra (UK) Ltd with a plant in Knowsley, Merseyside and the Spanboard plant in Northern Ireland.

Some wood reprocessors have looked to diversify from their dependence upon the panel board industry – its international nature does make it subject to change with different geographic economic conditions. Also production of higher value recycled wood products has enabled the reprocessor to sell Packaging Recycling Notes (PRNs). However, with PRNs now worth very little, the latter is no longer an incentive.

The Panel Board Industry in the North East Within the North East the Egger Hexham plant is fairly secure – they are in the process of investing £100 million in replacing their two 20 year old production lines with a brand new ContiRoll line. They produce around 450,000 squared metres of product per annum16 and the new production line will increase capacity by around 45%.

A fifth company Vertex Ltd also had a plant in the North East at Shildon in County Durham until 2003 when excess UK capacity forced it to close. It had 2 manufacturing lines and produced around 150,000 squared metres

16 Egger Connect, July 2006

Regional Market Assessment for Wood Waste for North East England 55

of product per annum. Vertex used a small quantity of recycled and it is felt that the reprocessors who supplied it have found other customers.

Waste wood Trends in the Panel Board Industry The proportion of recycled feedstock varies between mills, depending on the type of end product. Egger Hexham are producing at the high quality end – producing boards for furniture manufacturing. The higher quality means that there is a practical limit as to how large a share waste wood can make up – around 45% in practice. Some other mills (such as Sonae in Knowsley) can use considerably higher recycled amounts as they are producing construction boards and work surface inners. Sonae have undergone an initiative (‘Project ’Wear’) to remove more contaminants and grit which have increased competition for material as they can now use in the region of 97% recycled feedstocks at Knowlsey.

Recycled feedstock is still mainly going in to chipboard. There is some experimentation with using it in MDF and it is not suitable to use recycled in OSB (oriented strand board) as OSB requires larger wood chips.

Although the economic pressure is to increase the volumes of waste wood in panel products (not only because the material is cheaper but also because energy costs are reduced with the lower moisture content of waste wood), there is pressure on the suppliers of material to reach ever-increasing standards. This is due largely to environmental regulations and the panel board manufacturers’ desire to continue working outside of the waste incineration regulations. Material they use in production must be WID compliant for them to be able to burn sanding fines. In order to use waste wood in their products, manufacturers must either comply with WID regulations and submit to quarterly testing of their inputs and/or have a WID compliant boiler for incinerating fines.

Consequently there has been pressure on recyclers to invest in plant and bring quality up. It has also meant that material that might once have been acceptable now needs to find new markets or even be landfilled in some cases.

Opportunities for Wood Recycling in Panel Board in the North East According to the Regional Recyclate Market Development Action Plan.17, a new Teesside waste wood processing facility to be operated by Ecopanel Manufacturing is in the planning and development stage. The report states that this operation could utilise low grade wood waste including treated wood waste, to produce an MDF comparable board. The proposed facility could potentially use up to 25,000 tonnes of wood waste per year, operating on a shift basis. The developers envisage the region being able to support up to three of these facilities located close to the source of waste wood.

However, as yet these plans remain unconfirmed. We await clarification from John Fitzpatrick, director of Walker Hall Group, the parent company of Ecopanel Systems Ltd and Ecopanel Manufacturing Ltd. Ecopanel’s website (www.ecopanelsystems.com) states that:

“Although initially conceived for developing countries to utilise agri-fibre waste and to help with creating jobs and wealth in rural areas the Ecopanel Systems ‘come of age’ with regards to that of Industrialised Nations. Unfortunately, the vast majority of existing wood based plants can only utilise the highest quality of ‘clean wood’ that is being recycled.

This is because their systems are mainly based on formaldehyde resin, and this restricts such plants in what they can truly recycle.

With Ecopanel Systems all wood based products can be turned into board, regardless of their origin and/or previous processing.

This is due to the specially formulated binding system EcoBond, this unique formula and manufacturing system allows any type of wood based waste and/or agri-fibre waste to be made into board.

Unlike formaldehyde-based systems, the products made by the Ecopanel System are infinitely recyclable, there is virtually no waste and the economic viability creates a very short payback time indeed.

17 Regional Recyclate Market Development Action Plan, by ENVIROS for ONE NorthEast, May 2006

Regional Market Assessment for Wood Waste for North East England 56

……………… Finished board can be used in the same manner as conventional chipboard. ……………..

Other sources of waste that can be converted into board are from Plywood manufacture, Veneer manufacture, chipboard manufacture, board covered with melamine, paper foil etc can also be processed without detriment to board quality.

Again the more traditional formaldehyde based particleboard manufacturing systems, can only utilise about 5% - 10% of chipboard waste otherwise board quality may suffer, with the Ecopanel System 100% of such wood waste can be utilised with no detriment at all to board quality.”

Barring the possibility of Ecopanel commencing production, there are no other immediate prospects of additional panel board plants in the UK so any increase in waste wood use in this industry will be via Egger from increased production quantities and/or increasing the recycled proportion of feedstock. The latter depends upon relative price; quality of available material and availability/price of competing materials – virgin round wood and sawmill co products.

Supply of waste wood is in part seasonal – less construction in the winter leads to less C&D wood waste (which tends to be lower quality in any case) – and cyclical – when imports are high, more single-use pallets are available for recycling (generally high quality WID-exempt waste wood, suitable for panel board and other high value end uses).

Current prices for raw materials in the panel board industry are: Recycled wood chip - approximately £18-20 per tonne delivered (source: WPIF) Sawmill Co-products - contract prices confidential Virgin round wood - approximately £18 per tonne delivered (source: Forestry Commission)

Although virgin and recycled are currently around the same price, recycled feedstock has considerably lower energy costs than virgin and attracts PRN revenue (although this is currently negligible). Where, as in Egger Hexham’s case, the panel board manufacturer is also reprocessing and supplying a portion of their own recycled feedstock, the economics leans further in favour of recycled.

Sawmill co-products used in panel board fall in to two categories: wood chips used as per virgin or recycled feedstocks and saw dust which is used in product finishing.

However, as the North East panel board industry is currently just Egger in Hexham, any increase in demand for waste wood will be largely met by their own supply company, Timberpak, located outside of the region near Leeds. There may be some opportunity for North East recyclers to supply a little more in to Egger, but what may be more significant is the opportunity for recyclers in the region to supply other panel board manufacturers outside of the region – such as the Sonae, Knowsley who have dramatically increased the proportion of recycled feedstock – and possibly new players such as Eco-Panel, if their plans go ahead.

6.2 Biomass Energy

Renewable Energy Renewable energy is the term used to describe energy flows that occur naturally and continuously in the environment, such as solar; wind; wave; tidal; hydroelectric; geothermal or biomass energy. Energy underpins every aspect of modern life, but the fossil fuels, which currently provide the bulk of our energy, release green house gases such as CO2 into the atmosphere. This is now happening at such a rate as to affect climate change.

The UK has 1% of the world’s population but releases 3% of global greenhouse gases, with the energy industry being the biggest single contributor. Increasing the use of renewable energy will help counter this, reduce pollution and environmental damage and help provide long term security of supplies.

Emissions The three main green house gases, produced via the combustion of wood and wood products, responsible for climate change/ global warming are carbon dioxide (CO2), sulphur oxides (SO2) and nitrogen oxides (NOx), with CO2 being by far the greatest polluter.

Biomass fuels are generally regarded as life-cycle carbon neutral as the CO2 they take in during cultivation offsets that given out when burnt.

Regional Market Assessment for Wood Waste for North East England 57

The lifecycle of CO2 emissions of coal are around 20 times that of biomass. The same ratio holds for sulphur oxides and nitrogen oxides released by coal roughly double those released by biomass.

Volatile Organic Compounds (VOCs) are pollutants such as carbon monoxide and hydrocarbons which are released in flu gases when fuel is not burnt at a high enough temperature to exact ‘complete combustion’. For woody biomass this means a boiler temperature in excess of 900 °C.

Particle emissions – dust and ash – from burning wood fuels are on a par with fossil fuels.

Government Targets & Legislation The UK Government has signed up to the Kyoto Protocol. Under this protocol and EC Member States agreements, the UK has a target of reducing greenhouse gas emissions by 12.5% between 2008 and 2012 and to reduce emissions by 20% below the 1990 level by 2020.

In addition, the 2003 white paper “Our Energy Future – Creating a Low Carbon Economy” pledged to cut CO2 emissions in particular, by 60% by 2050.

The three policy instruments that are driving the consumption of wood-based materials in the electricity generating industry are: „ The Renewables Obligation (UK) (2002); „ The European Union Emissions Trading Scheme (EU ETS) (2005); „ and The Large Combustion Plant Directive (LCPD) (2008).

The first two are related, in that they view biomass as a renewable and carbon-neutral fuel. The third policy instrument differs slightly, since it does not directly recognise the environmental benefits of wood-based materials as a fuel, but its implementation in 2008 could change the absolute level and types of material consumed by the energy generation sector.

The LCPD aims to reduce acidification, ground level ozone and particulates by controlling the emissions of Sulphur Dioxide, Oxides of Nitrogen and dust from large combustion plants.

All combustion plants/power stations built after 1987 must comply with the emission limits in LCPD. Those power stations in operation before 1987 (namely coal and oil in the UK) are defined as 'existing plant'. Existing plant can either comply with the LCPD through installing emission abatement (Flue Gas Desulphurisation) equipment or 'opt-out' of the directive. An existing plant that chooses to 'opt-out' is restricted in its operation after 2007 and must close by the end of 2015.

The Renewables Obligation (RO) legislation came in to effect in April 2002 as part of the Utilities Act (2000). As one measure of affecting the RO step changes in emission levels, the Government has set targets for the proportion of our electricity which should be from renewable sources as follows:

„ 3% in 2002/03 (we achieved 2.7% and 3.1% respectively in 2003 and 2004 from ‘eligible’ sources); „ 5.5% in 2005/06; „ 6.7% in 2006/07; „ 10.4% by 2010/11; „ 15.4% by 2015 and guaranteed to be at least this level until 2027; „ An aspiration of reaching 20% of electricity supply from renewable sources by 2020.

Each 1% is equivalent to 1,000 megawatts of electricity – equivalent to 300 to 500 wind turbines or twenty 50 MW biomass power stations.

Efforts are also being made to increase the use of renewable energy for heat and also renewable fuels for transport.

The mechanism for achieving target renewable energy levels is the Renewable Obligation Certificate – or ROC for short.

Regional Market Assessment for Wood Waste for North East England 58

Electricity generators receive 1 ROC for every megawatt hour of energy they generate from eligible renewable sources. The generators can sell ROCs either included in the price of renewable energy they sell to suppliers or by trading them separately. Electricity suppliers have to buy and present sufficient ROCs to cover their obligation.

Suppliers do also have the option of paying a ‘buy out’ price per MWh for any shortfall. All proceeds of buyout payments are redistributed back to the energy suppliers in proportion to the number of ROCs they present, relative to their obligation. Thus the trading value of ROCs is an incentive for generators to use renewable sources and the buyout option rewards suppliers who present the most ROCs and penalises those who do not present enough.

Figure 6.2.1 – Renewable Obligation Certificate & Biomass Wholesale Energy Prices

Ave. ROC & Biomass Energy Prices, £ per MWh Qtr 1 = Winter 01; Qtr 24 = Autumn 06 130 ROC 110 Biomass

90

70

50

30

10 123456789101112131415161718192021222324

Source: The Non-Fossil Purchase Agency, www.nfpa.co.uk

ROCs are traded via a number of avenues, including: bilaterally between suppliers and generators; on the open market where suppliers can sell ROCs which are surplus to their obligation; and via the Non-Fossil Purchase Agency (NFPA).

The NFPA hold quarterly auctions of ROCs and twice yearly auctions of renewable energy. ROCs have traded as high as £52 (in mid 2004) but are currently at around £40. A Megawatt of biomass energy is trading at around £108. Prices for renewable energy have risen steeply since the ROC scheme commenced (the higher prices include the price of the ROC).

The Buyout price started at £30 per ROC (i.e. per MWh supplied but not supported by a ROC) and is index linked. Thus the economics of the scheme are quite complex- for the incentives to work: [cost to the supplier of 1 megawatt hour of renewable energy, including the ROC price and net of any proportional rebates from the redistribution of buyouts] Must be less than [cost to the supplier of 1 megawatt hour of non-renewable energy plus the buyout cost].

As suppliers are generally major multinationals (with considerable bargaining power) and because the energy generators are trying to build long term relationships with suppliers, in practice a ROC may cost less than the market value as the benefit is shared between the two parties. This is an issue as the ROC was designed as an incentive to generators but it is being diluted by being shared with the suppliers.

Sources of renewable energy eligible for ROCs include: „ Landfill gas/ Sewage gas /Advanced mixed waste technologies (pyrolysis, gasification or aerobic digestion) - only the energy derived from the non-fossil element of waste; „ Conventional hydro schemes with a capacity of less than 20 MW/ New hydro schemes first commissioned after April 1st 2002 (irrespective of capacity); „ Onshore/ Offshore wind; „ Tidal/ Tidal Stream/ Wave power; „ Solar and photovoltaic power; „ Biomass: energy crops; agricultural and forestry co-products; „ And co-firing biomass and fossil fuels.

Regional Market Assessment for Wood Waste for North East England 59

Biomass Biomass, also known as biofuels or bioenergy, is obtained from organic matter, either directly from plants or indirectly from industrial, commercial, domestic or agricultural products. The use of biomass is generally classed as a ‘carbon-neutral’ process because the carbon dioxide released during the generation of energy is balanced by that absorbed by plants during their growth. Properly designed combustion chambers used for the burning of biomass will minimise emissions of particulates and poly-aromatic hydrocarbons (PAHs) to the atmosphere. The atmospheric emissions from a 1-megawatt woodchip-fired biomass boiler used to provide district heating are equivalent to the emissions produced by a single domestic coal fire.

Biomass falls into three main groups:

„ Dependent resources: co-products and waste generated from agricultural, industrial and commercial processes. „ Dedicated energy crops: these are short-rotation crops, such as coppice, miscanthus, willow and poplar, which are grown specifically to generate biomass fuel. „ Multi-functional crops: These are crops that can be used to create different types of energy.

Energy can be derived from woody biomass sources (including forest products, waste wood and straw) using combustion systems, which can be used to heat anything from a domestic stove or hot water system to an entire community. Biomass can also be used on its own or by co-firing it with fossil fuels in power stations, reducing greenhouse gas emissions by replacing a component of the fossil fuel required. In industrial or agricultural use, boilers fuelled by woody biomass such as cardboard, wood and waste pellets or straw can help reduce waste removal costs.

Initially power stations co-firing biomass and fossil material will be eligible for ROCs on a pro-rata basis depending upon the proportion of the energy inputs. The limitations to this are currently as follows:

„ From 1/4/09 co-firing would only be eligible where at least 25% of the energy content of the biomass element is derived from energy crops, rising to 50% from 1/4/10 and 75% from 1/4/11. „ From 1/4/16 co-firing will no longer be eligible for ROCs at all.

The co-firing measure was designed to stimulate the supply chain for energy crops, which obviously have a growth lead time. The limitations and final removal of co-firing eligibility was expected to induce investment in the energy-crop sector. Also suppliers are limited to a maximum of 10% of their ROCs from co-fired energy generators.

However, there have been some set backs in launching the energy crop industry in the UK and co-firing is now seen as having a positive contribution to play in its own right, not just as a stepping stone. Consequently On 1 March 2006, the Government announced its intention to review the restrictions on co-firing within the Renewables Obligation, as part of the Energy Review. The results of this review are awaited.

Biomass Boilers Precisely what materials can be combusted in a biomass boiler and in what proportions is dependent upon the type of boiler and whether it is compliant with the Waste Incineration Directive (WID).

Anyone burning what is regarded as a waste product needs to have a Pollution Prevention & Control permit (PPC). That may restrict the volume/ proportion of waste which can be burnt and the temperature at which it can be burnt.

Hence SembCorp’s Wilton 10 boiler is limited to a maximum of 40% waste in its feedstock (’co-incineration’), whilst Egger’s new fully WID-compliant boiler may incinerate 100% waste products (‘full incineration’).

Co-incineration boilers require lower initial capital investment. Also by building demand for energy from waste steadily, gate fee levels for organisations accepting waste wood should remain more stable. A sudden increase in demand for material as fuel could have drastic downward affects on gate fees and thus undermine the reprocessing industry.

Regional Market Assessment for Wood Waste for North East England 60

Table 6.2.1: Summary of Biomass Plant Types Recycled Wood Used UK Co-firing power stations Not WID compliant so can take ‘clean waste wood’ only. Currently using 1-1.5mtns of biomass per annum (mainly oils and pine kernels), largely imported. Drax power station in Yorkshire plans to co-fire with 1- 2 mtns of biomass per annum. As it cannot find that volume of compliant wood, they are looking at other sources. The co-firers have largely turned away from recycled wood (due to confusion between ‘clean’ which does not need to be WID compliant and non-WID compliant wood waste). Dedicated co-incineration Biomass plants, E.g.. Slough Heat & Power; Shotton; Wilton 10; Not fully WID compliant Lockerbie Can burn 40% waste to 60% virgin feedstock. All wood waste except hazardous permitted. Dedicated full incineration plants, Egger’s new boiler (the first in England). Fully WID compliant Can burn 100% waste. Egger will burn process fines.

Small scale biomass schemes Clean, low moisture recycled wood may be used. Tend to use wood pellets (reduced storage). No plants in the UK can take this waste wood, but Hazardous/CCA treated apparently there are boilers on the continent which are burning waste telegraph poles and railway sleepers. Source: ESYS

There are a number of potential projects in the UK – Express Power in Wales is looking in to a biomass plant which would use 150ktns of factory wood waste; Western Energy in Wales is looking at a wood biomass plant (although may not use recycled) and there are other projects mooted in the East, South and West of England.

If all these projects went ahead they could use another 720ktns of recycled wood fuel chip per annum. However, this is highly unlikely as the projects are only in the early stages and do not yet have an appreciation of the legislative implications.18

The Biomass Industry in the UK The UK Government has recognised the value of biomass energy in helping to meet our renewable energy obligations and published the Biomass Task Force Report in October 2005. The Government has responded to the report’s recommendations with an action plan for which DEFRA have implementation responsibility.

A summary of the key points of the action plan follows:

„ Capital support for the installation of biomass boilers for heat; „ Various support measures for the energy crop agricultural sector; „ Forestry Commission’s Biomass Energy Centre as a major new hub for bioenergy advice and best practice; „ Government leadership through public procurement; „ Working with Regional Development Agencies and other organisations to ensure effective, coordinated mechanisms for delivery of policy and advice; „ Use of the planning system to stimulate renewables development, including our support for planning authorities applying a minimum percentage of renewable energy in new developments; „ Action to address regulatory barriers identified by the Task Force and to develop standards to improve efficacy and confidence in biomass;

18 Source: WRA meeting, December 2006

Regional Market Assessment for Wood Waste for North East England 61

„ The introduction of new Building Regulations, from April 2006, with new procedures and tougher standards which will encourage the use of Low or Zero Carbon (LZC) systems, such as biomass; „ Government thinking on the use of energy from waste, subject to conclusions from the current review of Waste Strategy and the Energy Review; and „ Support for the EU Biomass Action Plan and agreement on UK membership of the Global Bioenergy Partnership from its launch in May 2006.

It is clear that the biomass industry will undergo considerable growth over the next ten years.

The current UK position is that there are a handful of large scale biomass schemes either in production or about to go in to production and a number of small scale schemes, such as community boilers heating housing association properties and/or public buildings.

Slough Heat and Power (SHP)

SHP is part of the Slough Estates plc property group. It is a multi-utility company, serving the customers of the Slough Trading Estate. SHP has converted its 35MW coal-fired power station to run predominantly on wood chips and non-recyclable packaging materials. In doing so it has reduced its emissions by two thirds. SHP's conversion from coal to wood and packaging based fuels replaced over 200,000 tonnes of coal per annum. Its conversion started in 2001/02 and was 90% wood-fired by May 2004.

SHP has had some difficulties with their boilers: as they were designed for coal (which burns acidic) there have been corrosion issues from burning wood fuel (which burns alkaline). Provided these problems are overcome, SHP has the potential to use 100,000 tonnes of wood fuel per annum.

E-On/Powergen at Lockerbie

Powergen are commissioning a £90m purpose-built dedicated 44 MW biomass power station in Lockerbie, South West Scotland, aided by £18m lottery funding. The development will burn natural fuel to power around 70,000 homes. It was due to go live in December 2007 but it is thought it has actually pulled ahead of schedule and is likely to be operational in the summer of 2007.

E-On estimate the power station will save 140,000 tonnes of carbon emissions per year.

It is thought that the project will generate more than 300 jobs in the area - 40 directly and 300 in forestry and farming. The power station will require 220,000 dry tonnes of fuel per annum. 20% of this is planned to be locally harvested willow. AW Jenkinson of Carlisle will be providing wood chip fuels, virgin and recycled, to the power station.

SembCorp at Wilton

Singapore-owned SembCorp Utilities are commissioning a £60m purpose built 30MW wood-burning power station at Wilton, near Middlesbrough, supported by a £10m Bio Energy Capital grant. The power station will provide energy for the Wilton industrial estate (equivalent to powering 30,000 homes) and will require 300,000 green tonnes of wood fuel per year as follows. The fuel will be a mix of logs (from the Forestry Commission & UPM Kymmene at Shotton), sawmill co-products, short rotation willow coppice (from Greenergy Ltd) and recycled wood (from neighbouring UKWR Ltd). The plant is scheduled to go live in spring 2007.

The project provided 400 construction jobs and the power station will employ 15 staff directly.

Shotton, Flintshire

A biomass boiler has been built in Shotton which is being fuelled by 300,000 tonnes of arboricultural wood waste (brash from forestry operations) and paper sludge (from the Shotton newsprint mill) per annum.

Regional Market Assessment for Wood Waste for North East England 62

The Biomass Industry in the North East

As part of the region’s regeneration strategy, the North East has shown tremendous interest in renewable fuels and energy.

ONE NorthEast has a Biomass advisor – Chris Maxwell – and the region has a Biomass Implementation Group and Action Plan. Studies have been undertaken for the Environmental Industries Federation to poll public sector interest in biomass and to map installations in the region.

ONE NorthEast has committed £1.1m to fund a 2.5 year Bio Energy Development Service and have just selected a contractor to deliver this service. It will subsidise the cost of technical support to end users by 80% and provide business planning, training and marketing support. It will not, however, provide capital funding.

Figure 6.2.2 – Map of Biomass Installations in the North East

Source: Environmental Industries Federation

The figure above illustrates the biomass installations which are already present in the North East region.

Table 6.2.2 lists the size and type of each installation. It can be seen that Wilton is by far the largest existing opportunity for using recovered wood chip. Some of the smaller installations already use recycled wood. Some of the other woodchip installations may be able to use some recovered chip, depending upon the type of boiler they have installed and whether they have the correct licences. Clean waste wood and packaging wood waste are currently exempt from the Waste Incineration Directive.

Regional Market Assessment for Wood Waste for North East England 63

Table 6.2.2 : Breakdown of North East Biomass Installations Project Size Location Project Location Project Site (kW) Type Aykley Heads Durham Trinity School 366 Pellets Cassop Cassop School 200 Pellets Cleatlam Strathmore Farm 100 Woodchip Consett Explorer Group Ltd 290 Recovered wood Eaglescliffe Skippy Waste Services N/A Recycled wood Falstone Northumberland National Park Authority Visitor Centre 10 Pellets Ferryhill Ferryhill Comprehensive School 200 Pellets Kielder Village Kielder District Heating Scheme 300 Woodchip Maltby Maltby Grange Farm 350 Recycled wood Rennington Lee Moor Farm 80 Woodchip Sedgefield West Butterwick Farm 193 Straw Sleekburn Blyth Star Enterprises 150 Recycled wood Staindrop Staindrop School 400 Pellets Peterlee Peterlee Unknown Morpeth Morpeth Unknown Hetton-le-Hole Hetton-le-Hole Unknown Widdrington Widdrington Unknown Other biomass heating use in the North East 395 Heating Total 3,034 Lynemouth Lynemouth Power Station (ALCAN) 8,000 Pellets Wilton Wilton International (Not yet live) 30,000 Woodchip Electricity Total 38,000 Source: Environmental Industries Federation

This chart excludes the Egger biomass boiler, which is expected to use around 40-60,000 tonnes of wood waste (fines) per annum to provide process heat to dry feedstock and to heat the plant.

Alcan use around 90,000 tonnes of imported virgin wood pellet per annum to power their manufacturing activities via the Lynemouth 8MW biomass power station.

Recycled Wood Fuels: Chips and Pellets

There are two main types of wood biomass fuels: chips and pellets.

Fuel pellets have the advantage of being denser and hence take up less storage, so are more suitable for smaller installations. Increased density can also reduce transport costs (where volume is more constraining than weight of load) and is more homogenous for handling and combustion.

The choice between pellets or chips might also depend on boiler type: co-firing power stations which burn lump coal can take chips, whilst co-firing power stations which burn coal in dust form can take pellets and these may need further crushing. Chips do not crush well and would need to be resized for dust burners.

However, pellets are considerably more expensive than wood fuel chips: chips command revenues between around £20-27 per tonne, whilst pellets command £85-£120 per tonne for small scale installation (£40-60 per tonne for power stations). Prices vary geographically. In the North East pellets sold to smaller operations are priced at £85-£100 a tonne. Larger scale users tend to import pellets at around £75 per tonne, as pellet production is an infant industry in this country – with only two known producers (Wood Pellet Energy UK & Welsh Biofiels).19

Table 6.2.3 illustrates that the typical capital investment required to set up a wood pellet production plant with a capacity of around 20,000 tonnes a year is around £2.6 million. A fuel chip operation would not require the pelletising equipment and hence could expect to invest around £1.9 million, but the product is less profitable.

19 The prices quoted are from consultations in Nov 2006 and WRAP reporting from 2004. Please note that these are subject to change with the market.

Regional Market Assessment for Wood Waste for North East England 64

Table 6.2.3: Estimated Capital Investment for a 20,000 tonne per annum dedicated pelletising plant £000 Loader £100 Shredder £150 Tromel screener £37 Eddy current screen £75 Pelletising equipment £500

Direct Capital Investment £862

Site, premises & other equipment £1,800

Total Capital Investment £2,662

Source: WOO0055 & WOO0017 WRAP reports

Recycled Wood Trends in the Biomass Industry

Waste wood is a cost effective feedstock compared to virgin wood. It has half the moisture content of virgin and hence requires less drying – recovered wood fuel chip has half the energy production cost of virgin fuel chip, with virgin costing £3 per giga-joule (Gj) and recycled £1.50 per Gj.

However, the capital costs of setting up the plant to manufacture recycled fuel chip are considerable and hence is not an activity to be considered by small start up businesses. UKWR Ltd invested around £4 million in their plant and received a £240,000 grant from ONE NorthEast.

Virgin and recycled fuel chip sell for a similar price - £20-27 per tonne. The recycler has this sales revenue plus the gate fees received for taking the material. Recycled chip needs to be at the lower end of the price region to compete with virgin material.

SembCorp have a contract with neighbouring UK Wood Recycling Limited to provide 80,000 tonnes of recycled wood chip per annum. Powergen at Lockerbie have a contract with AW Jenkinsons of Carlisle for wood fuels.

The Biomass industry has the opportunity of diverting low grade waste wood which is not good enough for the panel board or high value recycled wood markets, from landfill. There are still no outlets for highly contaminated wood – CCA-treated wood, old railway sleepers and telegraph poles – in the UK, but the technology does exist and is believed to be utilised by a company in Germany to extract energy from old telegraph poles and railway sleepers.

SHP, Lockerbie and Wilton power stations have the capacity to use up to 500,000 tonnes of recycled wood per annum by 2010 and some predict that by 2016 biomass will have overtaken the panel board industry as the leading user of waste wood.20

Opportunities for Wood Recycling in Biomass in the North East

Power Generators Wilton and Lockerbie will be the first large scale purpose built biomass power stations to use wood as their renewable fuel source.

The Wilton project will create 15 permanent jobs in SembCorp, up to 40 permanent jobs at UKWR Ltd and additional jobs during construction. In addition, the power station will also help secure jobs in the forestry and energy crop sectors. It will generate 30MW of electricity – equivalent to the power used by 30,000 homes per year.

20 WRA minutes for December 2005 meeting.

Regional Market Assessment for Wood Waste for North East England 65

The energy crop portion of the feedstock will come from Greenergy Ltd in the form of short-rotation willow coppice, to be grown on 7,500 acres of land within a 50 mile radius of the plant.

The virgin wood feedstock may or may not come from within the region as the forestry industry will match the grade of material to the need rather than supply within the area.

SembCorp can burn a maximum of 40% waste material under their licence. With a requirement for 300,000 (green) tonnes of material a year, this would give a maximum recycled wood component of 120,000 tonnes per annum. They actually have a 10 year contract with UKWR Ltd to provide at least 80,000 tonnes per annum.

Industry As well as the power industry itself, rising energy costs and waste disposal costs have provided incentives to large industrial sites to look at heat/power from biomass. Hence, Egger’s investment in a WID-compliant boiler to a) rid themselves of waste materials and b) provide heat for the plant.

Alcan’s smelting operation in Ashington, Northumberland is powered via the company’s own Lynemouth Power Station, co-fired with coal and wood pellets, although these are virgin material.

Community Schemes At the other end of the scale there are opportunities for more small community biomass projects – such as the Kielder District Heating Project.21 Kielder Forest is home to 50% of the region’s Forestry Commission woodland.

In the Kielder scheme, locally-grown wood is chipped and stored by Forest Enterprise at a specially designed fuel store in Kielder Village. The wood chip fuel is then delivered to the boiler house and is fed to a 300 kilowatt Austrian Köb boiler. The hot water is piped to surrounding buildings, where heat exchangers transfer the energy into domestic central heating and hot water systems. A heat meter measures the amount of energy used by each customer, and the local community company sends them monthly heating bills. Kielder Community Enterprise Ltd has been established as a community-owned energy service company or "ESCO", providing a permanent source of local employment.

The wood chip for the Kielder boiler is sourced from currently unutilised forest residues from the forestry operations in Kielder forest. These include small roundwood, i.e. small stems cleaned of side branches with a top diameter greater than 7cm and poor quality final crops - though large enough to be used for timber these are of such poor form that they are normally left on site or they may be cut for firewood.

The timber extracted is then stacked and covered in the Kielder quarry for around 12 months to air-dry and reduce the moisture content. Once at a moisture content of between 20-30%, the timber is chipped into the chip store as available fuel for the boiler. The main fuel store can hold up to 450 cubic meters (between 80-120 tonnes) of wood chip from Kielder Forest. The store is restocked 3 – 4 times a year, hence it uses 320 – 480 tonnes per annum. The scheme supplies heat and hot water to six homes, a visitor centre, workshops, a school and the youth hostel.

There is interest in starting up other small scale schemes in the region from housing associations and public buildings. In the urban areas the ability to recycle local authority wood waste in to fuel is a possibility, but the supply chain infrastructure is not currently in place.

As discussed earlier, there is also interest in the region to convert municipal arboricultural waste in to wood fuel.

Issues for Wood Recovery for Biomass in the North East

Energy crops have not taken off in the way envisaged by government. In one sense this means there is more short term demand for other woody biomass materials – such as recycled wood fuel – but it has also held back potential start ups. There are currently 300 hectares of energy crop planting in the region, whose main market will be Wilton. But 30% losses were made in 2005 and farmers have had difficulty with some plant types which, though have succeeded in mainland Europe, are unsuitable for the North East soil and climate. Consequently farmers are particularly cautious and will require additional incentives to diversify into biomass growing.

21 http://www.neforestry.info/kielderheating/

Regional Market Assessment for Wood Waste for North East England 66

The outcome of the current Energy Review may change the relative emphasis on energy crops and it is difficult to predict what effect this will have on demand for wood fuels.

Concern about the renewable energy incentives redirecting material –virgin and recycled- from existing wood- based industries (predominantly the panel board and paper mill industries) has been expressed by a number of trade bodies and industries. This prompted the DTI to commission a study in to its affects.22

This report concluded that: „ Competition for woody materials from co-firing power stations would decline from 2005/2006 due to the energy crop phase-in rules. Although the Energy Review might alter that perspective. „ Scenarios for demand from dedicated biomass power stations were modelled, without a clear conclusion. Some have commented that the modelling was based on over optimistic estimates of virgin wood availability which have since been revised by the Forestry Commission. It was clear that the energy sector could drive up the price of wood materials, thus affecting the competing industries’ profit margins, but it is uncertain whether this would be a long term issue or one which will be resolved as the markets become more sophisticated.

In our consultations with Egger and UKWR Ltd, it would appear that they are trying to work together to ensure each gets the correct grade of material and do not directly compete. In fact Hadfield (UKWR’s Manchester-based sister company) is a supplier to Egger and have entered into joint ventures with Timberpak (Egger’s wood recycling business).

Wood Fuel skills and information flows are also an issue in the region. ONE NorthEast are working in conjunction with Northwoods on the ‘Ignite’ project, to train and skill up local workers in biomass boiler installation and maintenance.

However, although there are measures in place to provide infrastructure and skills, the feedstock supply chains are not sophisticated enough yet to collect and sort the different grades of wood from the local authority waste streams to enable low grade material to be redirected to fuel instead of landfill. This area could benefit from help rather than leaving it to market forces.

6.3 Higher Value Markets for Waste wood

6.3.1 Animal Bedding & Surfaces

The UK Animal Bedding & Surfaces Industry The animal bedding and surfaces market in the UK is worth in excess of £275 million per year. Cattle bedding is the largest portion of the market, pet bedding and equine bedding are the most profitable sectors.

Table 6.3.1.1 - Estimated UK Market Size for Animal Bedding & Surfaces, 2004 Woodchip % (Virgin & Recycled Recycled Type Volume 000tns Value £m £/tn Recycled) % £/tn Equine bedding 430 to 450 57+ 130+ 33-37% 11-12% £130-160 Equine gallops & surfaces 75 to 80 4 to 7 53 to 82 30-35% ? ~£28 Cattle bedding 3,000 to 4,000 120 to 200 40 to 50 2-4% 1-2% ~£10 Poultry bedding 300 to 350 25 to 39 90 to 100 75-85% ? ~£80-90 Pet bedding 18 to 25 25 to 30 1,200 to 1,667 10-12% ? ~£600-1000 Litres £/Lt Cat litter 29,000 to 33,000 49 to 50 12p to £3.99 No information Source: WOO0040 - Emerging Higher Value Markets for Recycled Wood Products – Market Opportunity Study by AMA for WRAP, 2005

22 An Independent Study Looking at Specific Issues Relating to the Wood Panel Industry and The Renewables Obligation, Jaako Poyry, Sep 2005

Regional Market Assessment for Wood Waste for North East England 67

The animal bedding and surfaces markets are made up of a variety of materials, including wood shaving products.

Commercially branded and marketed recycled wood products are present in all sectors except cattle bedding (which is a low value product).

Equine bedding in particular has seen some inroads by recycled wood products. Wood-based bedding makes up around 33-37% of the total bedding volume consumed in the UK and around one third of this is recycled wood chip to two thirds virgin wood shavings.23

There are four key players in the recycled wood equine bedding market and a number of smaller players. The key players are:

1. Manchester- based Hadfield, who market the Easibed brand. Hadfield have a presence in a number of other recycled wood markets.

2. West Bromwich-based Gifford, who market the Cushionbed brand, both directly and via a network of distributors (including UKCushion). Gifford are also active in recycled wood landscaping products and pallet refurbishment.

3. R W Plevin Son Ltd, who have a number of sites and market both virgin wood shavings and recycled wood products in the equine bedding market under a number of brands, including Snowflake; Woodpecker; Plevin and own-brand labels.

4. Urban Forest, a new market entrant, based in Northern Ireland and selling the All Bed brand of recycled wood equine bedding in Northern and the Republic of Ireland.

Based on WOO0055 consultations, recycled wood equine bedding production in the UK is expected to exceed 75,000 tonnes per annum in the next few years, if manufacturers’ plans are realised. WOO0040 estimated the UK wood shavings (virgin and recycled) bedding sector to be 154-176,000 tonnes per annum.

However, it should be noted that some UK produced material is exported. Both Hadfield and Gifford export to the Middle East. There is some potential for growing the recycled market share in the UK – primarily through taking share from the virgin shavings market and to a lesser extent, from straw. The market size itself is fairly static, as is the UK horse population.

Cost-benefit analysis for WOO0055 indicated that where a quality, branded product is produced, the recycled wood equine bedding market is profitable, albeit heavy capital investment is required up front. Profitability is anticipated to decline somewhat as the market develops. Examining costs and benefits from the user perspective would suggest that the price of recycled wood equine bedding could probably rise slowly as it is currently considerably cheaper than wood shavings if used in line with the manufacturers. But there is user education issues associated with this.

Table 6.3.1.2 – Comparison of Virgin & Recycled Wood Equine Bedding Consumer Costs Bedding material Requirements for 12x12 stable Cost Virgin wood shavings 8 bales initially then 2 bales a week, daily mucking out £4 - £7 per bale Æ £440 to £770 pa per stable recycled woods 7 to 8 bales initially then 1.5 bales a week, deep or semi- Retail £3 to £4.80 a bale in bulk. deep litter regime. £254 to £406 pa per stable Source: WOO0055 Anyone considering entering this market needs to bear in mind that its profitability is dependent upon scale and having a quality brand: WOO0055 concluded that to set up a recycled wood equine bedding plant producing 20,000- 25,000 tonnes of product per annum would require capital investment in the region of £3 million. Table 6.3.1.3 summarises the commercial cost benefit analysis presented in WOO0055:

23 WOO0055 - Recycled Wood in Equine Bedding – The Commercial Case, ESYS Consulting Limited for WRAP, June 2006

Regional Market Assessment for Wood Waste for North East England 68

Table 6.3.1.3 – Commercial Case for Producing Recycled Wood Equine Bedding Case 1 Case 2 Tonnes equine bedding pa c25,000 C20,000 Total reprocessing business tonnes pa 100,000 Dedicated plant Assume 100% pckg Assume 100% pckg Indirect Capital Costs £k

Site & Premises £950 £1,000 ALL Shared Equipment £1,250 £800 Equip Depreciation pa over 5 years: £250 £160 Indirect Revenue costs £k Admin Overheads £190 £100 Sales & Mktg £250 £150 Transport costs (salaries, running etc) £100 £90 Indirect Finance costs @ 5% £110 £90 £650 £430 Direct Capital Costs £k ALL £600 £1,500 Lifespan: Depreciation pa over 5 years: £120 £300 Direct Revenue Costs £k Production line labour £115 £100 Production line mtce £140 £140 Direct Finance costs £30 £75 Materials e.g.. Pckg £150 £120 Energy £25 £20 £460 £455 From To From To Income £k Material gate fees £375 £300 PRN monies £250 £200 Delivery revenues nil nil Sales Revenue (£130 to £160/tn) £3,250 £4,000 £2,600 £3,200 ALL £3,875 £4,625 £3,100 £3,700 Costs £1,480 £1,480 £1,345 £1,345 Revenues £3,875 £4,625 £3,100 £3,700 GROSS PROFIT FOR EQUINE BEDDING £2,395 £3,145 £1,755 £2,355 Capital Investment: £2,800 £2,800 £3,300 £3,300 Profit per tonne: £95.80 £125.80 £87.75 £117.75 Source: WOO0055

It should be noted that PRN values have crashed since this study and hence profitability will have reduced slightly.

Such detailed analysis has not been completed for other forms of recycled wood animal bedding and surfaces. Table 6.3.1.1 above illustrated that the volume & high value markets are equine bedding and poultry bedding. Lead players in the equine market – such as Hadfield (Easichick), RH Plevin & Son and Urban Forest – also serve the poultry market.

The Animal Bedding & Surfaces Industry in the North East

The previous section illustrated that although the animal bedding and surfaces market can provide profitable business opportunities, this tends to be for larger companies producing product as part of range of wood recycling activities and with sufficient size to allow for significant capital investment.

At present there are no manufacturers of recycled wood animal bedding and surfaces in the North East. There are a few manufacturers of virgin wood-based animal bedding in the North East:

Regional Market Assessment for Wood Waste for North East England 69

„ Northumberland based Bedmax produce quality horse bedding from renewable soft wood shavings; „ H Eggleston & Son Ltd, based in Durham, make Comfeypet bedding from 100% virgin wood from renewable sources and sawmill co-products. Their suppliers are spread over Northern England; „ Darlington-based Edgar F Shepherd make unbranded cattle and poultry bedding from sawmill co-products.

The latter two companies have experimented in the past with post-consumer wood but have not found it economic and hence now only produce from virgin material. We estimate that they both produce in the region of 5000 to 10000 tonnes of product per year.

In terms of a North East sales market, horse-ownership is not particularly high due to low disposable income and hence markets for material would be predominantly outside of the region.

Recycled Wood Opportunities in the North East Animal Bedding & Surfaces Industry

The big opportunity for this market in the region is UK Wood Recycling Ltd in Middlesbrough. They have the knowledge (being Hadfield’s sister company) and capacity for producing Easibed and Easichick in the region, with limited additional capital investment. UKWR have stated from their launch that their long-term plans are to diversify from just supplying SembCorp with fuel grade material to also processing higher grade material in to higher value markets.

However, as discussed elsewhere in this report, the key issue currently is securing supplies of material in the region. To date UKWR have been transporting lower grade material from Manchester and the M62 corridor up to Middlesbrough in readiness for SembCorp’s Wilton 10 power station going live. By contrast, small quantities of high grade material have been shipped back to Manchester for processing at Hadfield’s plant. The company hopes that over the next 3 years regional supply chains will be established and they will be able to expand production to cover higher value products as well as fuel chips at the Middlesbrough site. This production would be in addition to the Hadfield Manchester production and not a displacement.

6.3.2 Landscaping Products

The UK Landscaping Products Industry

Landscaping and horticultural surface products include: „ Surfaces for children’s play areas (loose fill and solid); „ Surface materials for pathways (loose fill and solid); „ Growing media for amateur and professional markets; „ Decorative mulches; „ Compost products; „ And soil remediation products.

Table 6.3.2.1 below summarises the size of the landscaping sales markets relevant to recycled wood in the UK, as gleaned from aforementioned WO00040 and WO00055:

Regional Market Assessment for Wood Waste for North East England 70

Table 6.3.2.1 – Estimated Market Size for Wood Chip Materials in UK Landscaping Volume - 2004 '000 tonnes Value - £m £ per tn Loose fill Impact absorbing Play Surfaces (LIAS) 16 to 19 1.8 to 2.0 ~120 of which recycled wood chip 20-30% £65/ tonne ~65 Pathways 10 to 1224 0.475 to 0.525 ~40-52 of which recycled wood chip 3+ Mulch 275 to 300 50 to 60 166-218 of which recycled wood chip 23.75+ ~65 Composted material for growing media ~60 low of which composted wood waste 6 to 12 Composted material for soil remediation 100 to 300 low of which composted wood waste 20+ Source: derived from WO00040 & WO00055

The Landscaping Products Industry in the North East

With lower disposable income than elsewhere in the UK, the North East has not seen the same surge in spend on home and garden improvements. Consequently any company manufacturing landscaping products in the region would have to supply a wider geographic market.

In terms of manufacturers active in the landscaping products markets, there are no significant producers based in the North East region. However, one of the key operators in the market is AW Jenkinson and its sister company Melcourt Industries. AWJ have plants in Southern Scotland and Cumbria and hence compete for materials within the northern UK. AWJ also supply in to the animal bedding and biomass industries.

Recycled Wood Trends in the Landscaping Products Industry

General There are basically two types of recycled wood material/products being used in the landscaping and horticulture sector: non-composted wood chips and composted material containing recycled wood.

The non-composted recycled wood chips may be natural or coloured and are sold into the following end markets: „ As a landscaping mulch to suppress weeds and retain moisture in planting beds and pots; „ For laying informal paths in public spaces, golf courses etc; „ For decorative use in exhibition areas; „ For covering play areas to protect children from injury.

The safety requirements and precise chip specification might vary depending upon which one of these end markets the product is being sold into, although most of the players in this market sell essentially the same product into one or more of the markets.

Compost containing recycled wood may be sold into the following end markets: „ Peat-free/ peat-reduced growing media; „ As soil improver to be dug in/ mulched on top of growing beds; „ As an ‘ingredient’ in land reclamation/soil remediation projects. In this instance compost is mixed with other materials to reinstate land prior to planting out. The other ingredients might include existing spoil/earth from the site or bought-in top soil, with the compost adding nutrients.

The prices of landscaping recycled wood products vary significantly by end use and order quantity. Approximate prices are summarised below25:

24 WO00040 estimated that the total LIAS pathway market is at least 10,750 tonnes per annum, although ESYS believe it may be considerably larger than this

25 WOO0017: Characterisation of Emerging Higher Value Markets for Recycled Wood Products, by Urban Harvest Ltd for WRAP, June 2004

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Table 6.3.2.2 – Recycled Wood Landscaping Product Prices Order quantity Surfaces - Mulches - £/m3 £/m3 Natural Chip Bulk £8 £9 Coloured Chip Bulk £22 £19 1 tonne bags £23 £29 80 lt bags, by the pallet load £40 £40 Retail units - 75-80 lt bags £75 £81

Natural recycled wood products are highly price competitive in the play surface and pathways market, being priced at only 24-55% of competitor product prices. Coloured recycled wood products are also competitively priced against quality alternatives sold in bulk.

As mulch, both natural and coloured recycled wood products compete well on price against quality alternatives when sold in bulk or by the pallet load.

Of course, the analysis above takes into account price alone. There are other attributes upon which recycled woods can compete favourably with wood competitors: „ They break down more slowly and hence are longer-lasting; „ They do not absorb as much nitrate or carbon from the earth; „ They have environmental ‘kudos’ and confirm to ‘green’ procurement policies.

These additional selling features do have to be offset against negative perceptions of contaminants in recycled wood materials.

WOO0017 modelled the costs of producing different recycled wood products. Although production costs per tonne are not radically different (£51-58 per tonne) for different types of product, sales revenues vary between £32 and £88 per tonne. Thus for some products profitability is highly dependent upon gate fee and PRN levels.

The highest profit margins are for are coloured play and path surfaces, followed by coloured mulches. However, in terms of market size, the potential in the mulch market is far greater than in play and path surfaces. Natural coloured products are considerably less profitable, but in practice many people prefer the natural look for landscaping, so the premium product is very much a niche player.

The table below summarises who the key players are in the market and what recycled wood brands they market:

Table 6.3.2.3 – Key Players in the UK Recycled Wood Landscaping Product Market Company Mulches LIAS Paths LIAS Play Compost Colour Surfaces chips? Giffords Enviromulch Enviromulch Cushionfall ------Yes Tracey Timber Decorchip Decorchip/ Tiger Decorchip ------Yes Wood Chip Eglington (Timber Natures Finish ------Yes Products) Ltd Eco-Composting Eco wood Path Chip Playground Chip Currently trialling Not for Ltd mulches recycled woods Wood Yew Waste Garden Mulch Tiger Wood Chip ------No County Mulch Ltd Green Top ------Not now, have No Economy Mulch done in the past

We estimate that the above products alone account for around 90,000 tonnes of recycled wood per annum. A number of smaller operators account for an additional 15-20,000 tonnes in these markets, giving a total usage of up to 110,000 – which is in keeping with MEL’s estimate of around 109,000.26

26 WOO0041 "The status of wood waste arisings and management in the UK", MEL for WRAP, June 2005

Regional Market Assessment for Wood Waste for North East England 72

Mulch The landscape mulch market is estimated to be around 275-300,000 tonnes of material per annum, or £50-60 million. Recycled wood chip is estimated to have an 8-9% share of the market by volume. It is the largest landscaping market for recycled wood products.

Play Surfaces

Play surfaces need to comply with EU safety standard BS EN1177 and pathway material in public places is increasingly subject to regulation due to the Disability Discrimination Act (DDA). These legislative measures have seen a move away from loose fill material. The loose fill play surface market is static at around £2 million per annum, whereas the overall play surface market almost doubled between 2002 and 2004. The trend in this area is towards wet-pour rubber and rubber tile surfaces.

DDA legislation means that play surface and pathway materials in public places need to be accessible to all – including wheelchair and pushchair users.

Pathway Surfaces Although hard surfaces are the predominant choice and increasingly being used because of the DDA, there are still opportunities to use recycled wood products in pathway applications, although this is not an easy market at present according to existing suppliers.

Where loose-fill pathway surfaces are chosen, the advantages of using recycled wood products over virgin wood chips are: „ Reduced moisture levels and a fibrous nature make recycled wood products longer lasting than equivalent sized non-recycled chips and hence reduces maintenance costs „ Commercially recycled wood products are generally less expensive than non-recycled chips „ Because the fibrous material ‘knits’ together, recycled wood products can be more suitable than alternatives for steep inclines; sticks to shoes less and allows easier access for wheelchairs/ prams.

Growing Media

Composted recycled wood in peat-free/reduced growing media is relatively small scale and low value. Only one of the key players in wood recycling that we spoke to was composting waste wood (MDF waste in 50:50 combination with green waste) and that was on a trial basis only at present. They believed it would be successful and that in the future they could be recycling 6000 tonnes of waste wood per annum via composting. However, the material would be low-grade and probably go to the agricultural sector free of charge (costs/margin being covered by disposal gate fees).

Land Remediation WOO0050 estimated that up to 288,000 tonnes of composted materials could go into land remediation each year in the UK (some into top soil manufacture, some as mulch and some as soil improver). How much of this could be composted recycled wood is an unknown quantity. If we presume a modest 10%, this would gives a potential for 10,000 – 29,000 tonnes of composted recycled wood to be used per annum.

WOO0040 identified 20,000 tonnes of recycled wood going to this end use via remediation companies Churngold and Biogenie (who operate under agreements with Cory Environmental and Biffa).

Hence there is huge potential for compost use in land reclamation (adding nutrients to brown-field sites for new use) and remediation (removal/neutralisation of contaminated land).

A recent study by Enviros et al27 identified 66 significant sites (5,300 hectares of land) ripe for remediation across the UK and looked at likely use of compost materials from 2006 to 2010. They found potential for half a million tonnes of compost to be used at these sites and an additional 150,000 beyond this to 2029.

27 “Uses of compost in regeneration and remediation of brownfield and derelict land in the UK”, report by Enviros Consulting and CL:AIRE for WRAP, April 2006

Regional Market Assessment for Wood Waste for North East England 73

The National Brownfield Strategy is an important government initiative to remediate/reclaim derelict land. The National Land Use database (NLUD) registers all brownfield sites in the UK. In 2002 English Partnerships commissioned a survey of NLUD sites which revealed 2,200 sites (17,000 hectares) in England alone had been derelict for 10 years. A further 1,500 sites had been derelict for less than 10 years.

These additional sites have potential for considerably more compost use in addition to the significant sites identified at by Enviros.

However, this end use for wood waste is large in scale but relatively low value.

Current Size of the Recycled Wood Landscaping Products Market in the UK WOO0055 estimated that the above products in table 6.3.2.3 alone account for around 90,000 tonnes of recycled wood per annum. A number of smaller operators account for an additional 15-20,000 tonnes in these markets, giving a total usage of up to 110,000 – which is in keeping with MEL’s estimate of around 109,000.28

Commercial Viability The research for WOO0050 suggested the following operating margins for the end uses discussed above: „ Natural Play surfaces - £2.17 to £16.17 operating profit per tonne (4 to 31% margin) „ Natural Pathways - £1.24 to £15.24 operating profit per tonne (2 to 29% margin) „ Natural Mulch - £6.17 to £20.17 operating profit pre tonne (12 to 39% margin) „ Coloured Play surfaces - £53 to £67 operating profit per tonne (93 to 118% margin) „ Coloured Pathways - £53 to £67 operating profit per tonne (93 too 118% margin) „ Coloured Mulch - £42 to £56 operating profit pre tonne (74 to 98% margin)

However, these figures do not include indirect costs, such as head office and administration overheads, marketing spend, general plant equipment and taxes. It also assumes that the feedstock is packaging and hence includes PRN revenues and gate fees. Viability of these markets really depend on the activities not being a company’s sole business as indirect overheads could easily swing profit margins into loss margins.

The coloured chip markets look more viable than natural chip markets, but do depend upon finding buyers – many are conservative about using coloured mulches in landscaping, preferring a more natural look.

We do not have any similar analysis for composted recycled wood as this market is still new, although our conversations with suppliers suggest that composting waste wood is viable for using material unsuitable for the other higher-value recycled wood products they supply.

The biggest problem facing operators in the recycled wood product landscaping markets is winning over conservative customers – local authorities and landscape contractors.

Recycled Wood Opportunities in the North East Landscaping Products Industry

The discussion above has indicated that market opportunities in the landscaping sector are greatest in the mulch market, with legislative forces constraining the size of the more profitable loose fill play and path surface markets. The composted waste wood markets are relatively new and low value, although remediation activities have the potential to use large quantities of material:

7.5% of the land (383 hectares) identified by Enviros et al (see footnote 14) as ripe for remediation across the UK is in the North East region. Hence this would imply regional demand for around 37,500 tonnes of compost materials from 2006 to 2010 and an additional 11,000 tonnes beyond this to 2029.

As discussed under the animal bedding section, the biggest issue is actually securing supplies in the region and this is where efforts should be concentrated rather than encouraging reprocessing/ high value product manufacturing capacity in the region.

Similar infrastructure, scale and levels of investment are required in the landscaping products market as the animal bedding markets, hence as with recycled wood animal bedding, the big opportunity for this market in the region is UK Wood Recycling Ltd in Middlesbrough.

28 WOO0041 "The status of wood waste arisings and management in the UK", MEL for WRAP, June 2005

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Despite the fact that Hadfields are not currently in the landscaping market, sister company UKWR have the capacity for producing surface materials, with limited additional capital investment. UKWR have stated from their launch that their long-term plans are to diversify from just supplying SembCorp with fuel grade material to also processing higher grade material in to higher value markets.

6.3.3 Other Markets for Waste wood

There are a number of alternative markets emerging for waste wood but these are not yet developed enough to assess opportunity within the North East.

Wood Plastic Composites are relatively small scale in the UK to date and currently use only virgin wood flour, although they do have the potential to use waste wood.

Other uses include:

„ Acorn Kitchen Timbers, a Teesside company hoping to launch kitchen work surfaces made of recycled timber. „ Blyth Star Enterprises, a social enterprise providing accommodation, employment and rehabilitation for pesrons suffering mental health problems. Employment includes a kindling operation which produces bags of fire kindling from waste wood. „ Furniture re-use schemes.

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7.0 Regional Recycled Wood Flows

This section summarises waste wood flows in the region whilst maintaining confidentiality. Appendix 2 (not published) provides the detail behind these figures:

„ Around 29,000 tonnes of waste wood are collected for recycling or recovery at HWRC sites and bulk collections in the region; „ 17-28% is sent out of the region for reprocessing; „ Around 14% goes to Energy From Waste; „ The remainder is forwarded to reprocessors in the area and goes on to the panel board and biomass end product manufacturers in the region; „ The key end users of waste wood in the region in 2007/08 will use around 205 thousand tonnes, with capacity to use around 324 thousand tonnes. Future plans could see capacity rise to 549 thousand tonnes; „ Around 111 thousand tonnes of waste wood used by end manufacturers in the area is brought in from outside of the area; „ An additional 157 thousand tonnes of material will need to be sourced by the two key end product manufacturers in the next few years; „ Wood waste from the region which is used within the region can be summarised as: around 17.5, 39 and 8.2 thousand tonnes of municipal, C&I, C&D waste respectively. This excludes quantities UKWR aims to extract from the regional waste streams in 07/08.

Figure 7.1 summarises waste wood flows in the region, with approximate current (March 07) tonnages:

Figure 7.1: Waste Wood Flows in the North East Region

Waste Wood Collectors Reprocessors out of the Region: Out of Region Supplies of Municipal; C&I; C&D EG Recycled Wood: EG AWJenkinson EG Sita Carlisle Hadfields Premier 5,600 tonnes (min) Timberpak Holystone Alex Smiles SWS 55,400 tonnes John Wade End Manufacturers: Thompsons of Prudhoe EG Egger Regional Reprocessors: UKWR Energy from Waste; EG Reivers WPEUK Landfill

39,000 tonnes End Products manufactured in the region & containing recycled wood: EG Panel Board Fuel chips Fuel Pellets

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8.0 Market Opportunities & Obstacles

8.1 End Market Opportunities

Panel Board The panel board industry is dominated by multinationals and hence there is little scope for any new major players to move in to the area, especially given Egger Hexham’s dominance.

Eco Panel Manufacturing are reported to be investigating a new Teesside plant to make a low quality MDF-type panel using 25,000 tonnes of waste wood per annum initially and expanding to three such plants in the future. Other than this and Egger’s planned expansion, there is little scope for further expansion in the region.

It is of course important to safeguard the jobs already provided in the region in this market.

Biomass There are opportunities in the biomass sector for recycled wood at different levels: power stations, such as Wilton 10; industrial heat/power installations such as at Egger and Alcan; smaller scale public/community projects.

It is important that biomass does not grow so rapidly as to displace existing markets – for all types of woody feedstock. The Recycling hierarchy needs to be applied- Reduce; Reuse; Recycle; Recover – with energy falling in to the last category.

Chris Maxwell, ONE NorthEast’s biomass advisor, feels the region has specific opportunities in the energy sector as a large proportion of the region does not have mains gas, whilst there are significant estates and business parks. This coupled with rising energy and waste-disposal costs in the commercial sector and fuel poverty in the domestic sector, provides an environment for further exploitation of small scale biomass boilers (10 to 15 KW).

Further large scale developments such as Wilton 10 are unlikely to be built in the region, although there is the possibility of a similar scheme in Yorkshire and Humberside which could still benefit the North East’s supply business.

Animal Bedding Setting up a plant to produce higher value recycled wood products (whether animal or landscaping surfaces) requires considerable capital investment in infrastructure. Consequently it is not really a sector for start-ups, more for diversification of companies in associated industries.

The big opportunity for this market in the region is UK Wood Recycling Ltd in Middlesbrough. They have the knowledge (being Hadfield’s sister company) and capacity for producing Easibed and Easichick in the region, with limited additional capital investment. UKWR have stated from their launch that their long-term plans are to diversify from just supplying SembCorp with fuel grade material to also processing higher grade material in to higher value markets.

However, as discussed elsewhere in this report, the key issue currently is securing supplies of material in the region. To date UKWR have been transporting lower grade material from Manchester and the M62 corridor up to Middlesbrough in readiness for SembCorp’s Wilton 10 power station going live. By contrast, small quantities of high grade material have been shipped back to Manchester for processing at Hadfield’s plant. The company hopes that over the next 3 years regional supply chains will be established (through market forces and landfill tax increases, although additional intervention could accelerate this) and they will be able to expand production to cover higher value products as well as fuel chips at the Middlesbrough site. This production would be in addition to the Hadfield Manchester production and not a displacement.

Landscape Products Market opportunities in the landscaping sector are greatest in the mulch market, with legislative forces constraining the size of the more profitable loose fill play and path surface markets. The composted waste wood markets are relatively new and low value, although remediation activities have the potential to use large quantities of material:

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7.5% of the land (383 hectares) identified by Enviros et al (see footnote 14) as ripe for remediation across the UK is in the North East region. Hence this would imply regional demand for around 37,500 tonnes of compost materials from 2006 to 2010 and an additional 11,000 tonnes beyond this to 2029. Some of this could be wood, but given more lucrative opportunities for wood waste, this would not seem a route to encourage.

As discussed under the animal bedding section, the biggest issue is actually securing supplies in the region and this is where efforts should be concentrated rather than encouraging reprocessing/ high value product manufacturing capacity in the region where the major players are already present in the region.

Similar infrastructure, scale and levels of investment are required in the landscaping products market as the animal bedding markets, hence as with recycled wood animal bedding, the big opportunity for this market in the region is UK Wood Recycling Ltd in Middlesbrough.

8.2 Other Opportunities

A consistent view was held by all interested parties in the region: emphasis must be on growing the supply end of the waste wood chain rather than encouraging more reprocessors/ end market manufacturers into the frame, as these will only dilute existing markets further.

The analysis above has shown that there are growing shortages of all types forestry products. Conversely, this provides an ideal opportunity for promoting greater use of waste wood. However, there are a number of steps involved in: a) identifying how much more waste wood in the region could be diverted from landfill; b) determining what uses it would suitable for; and c) growing the collection and sorting infrastructure to handle the diverted materials.

The Conclusions & Recommendations chapter suggest how these steps might be achieved.

There is the potential within the region to implement the kind of collection infrastructure proven elsewhere in the country, such as Hadfield’s successful skip and fleet operations along the M62 corridor. Existing reprocessors in the region are held back by their lack of infrastructure.

There are already some pilots in the region looking at extracting more wood waste from landfill: the South Tyneside Recycling Village have been trialling wood separation from bulky waste. At the time of our consultations, the early results implied an additional 1.8 tonnes of wood waste could be extracted from bulky waste collections per day. With life style changes, more panel board products are being scrapped, which could be directed to the energy sector.

There are also opportunities with delivery partners such as Renew Tees Valley in Teesside. If the model for RTV could be rolled out region wide it would provide a catalyst for increasing recycling and other environmental business activities. There are varying degrees of activity in the recycling sectors between the four sub-regions, indicating there may be a need for a region-wide body to take on recycling market development activity.

8.3 Obstacles to Market Development

National Barriers

The current economic climate for wood recyclers is not an easy one:

„ The ‘meltdown’ of the PRN system has led to lack of reinvestment in the wood recycling industry and cut margins to the minimum. Particularly a problem for people who entered the market encouraged by the PRN system who are now too dependent on PRN revenues. This point was reiterated at the December 2006 Wood Recyclers Association meeting, where the chairman encouraged members to increase gate fees. „ The initial high capital investment needed in wood recycling, as evidenced by the analysis in chapter 6. „ Rising energy prices have affected every form of business. Whereas it provides an opportunity for industry to put in their own biomass heat & power plants, it has a negative impact on reprocessors who see their own power costs soaring.

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„ Transport costs have also risen, making some markets un viable. For example, previously recycled wood fuel was sold from the region to Slough Heat & Power. Increased transport costs have made this uneconomic. More economic routes for moving waste supplies from where they are greatest – i.e. the South East – to the North East for reprocessing need to be investigated. This might include looking in to shipping routes to Teesside or rail freight options. For example, Intermodal Logistics Ltd (www.intermodallogistics.co.uk) markets a horizontal load transfer system from road vehicle to rail, which does not require fixed terminal installations and can be operated at any railway line or siding positioned beside a 10 metre wide roadway.

Legislative Barriers

„ There is much confusion over what wood waste is covered by the waste incineration and the waste management licensing regulations and what is not. „ Waste authorities concentrate their efforts on collecting materials, such as glass, paper and card, and organic waste. „ Smaller companies are not obligated under the packaging legislation which reduces incentives and quantities of packaging waste being recycled. „ Renewable energy incentives are for the generators not the feedstock producers.

Regional Barriers „ The North East has the lowest landfill costs in the country as it is sparsely populated and has a history of mining and quarrying. Currently it is cheaper for waste handlers to landfill material than to send it for even energy recovery. This will start to change as the landfill tax is increased. Many waste handlers have their own landfill sites so only pay the tax on their disposals. Those paying a gate fee are paying ½ the UK average at around £20-25 per tonne plus landfill taxes. „ A corollary of this is that the region has not come ‘up to speed’ and invested in collection and sorting infrastructure to the extent of other English regions. There are few major wood reprocessors in the area and a lack of skip/fleet infrastructure. „ The region’s remoteness and urban / rural contrasts together with variations in policy priorities mean that there are discrepancies in the level of recycling services between the various district, county and unitary authorities. Teesside have been most active in the environmental industries sector and Northumberland are now looking at setting up a waste partnership, but County Durham and Tyne & Wear have very little in the way of co-ordinated waste and environmental strategies. „ Education levels: of both the public and waste operatives as to what you can and can not recycle and how the materials should be sorted. The waste wood supply chain in the region is not currently sophisticated enough. „ Low levels of disposable income in the region mean that there are not markets for higher value products. Low spend on gardening compared to the rest of the country & low horse ownership. Those with money are city- based. „ Transport and communications to/from the region are stretched due to its peripheral location. The region also suffers from rural poverty. The geography of the region in terms of its remoteness and low population density also make for higher relative costs of collection, particularly given the relatively greater preponderance of SMEs. „ Egger has long term relationships with recyclers in the region and hence there is little incentive for businesses to diversify. „ Waste Management companies in the region are not investing in recycling. Sita concentrate their efforts on Energy from Waste (they have a 20MW plant at Billingham near Middlesbrough) and Premier are concentrating their efforts on aerobic digestion systems. Hence there is a limited culture – or economic incentive- for waste sorting and recycling.

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„ Existing businesses are suffering from increasingly stringent health and safety requirements, which may actually drive them out of business (for example, pressure to put previously outdoor recycling activity under cover to avoid dust). „ Some consultees complained of a skills shortage in the region for qualified operatives. „ The end of one European programme has led to uncertainty in the region, particularly for businesses which have leant on EU support funding. „ The lack of reliable regional data on the actual size and makeup of wood waste streams are a constraint which needs to be overcome. „ The region lacks suitable sites for wood recyclers. Although land is relatively cheap in the region, wood recycling activity has two key needs: to be in close logistical proximity to its supplies (encouraging ‘drop off’ of C&D/C&I waste and minimising transport costs for collections) whilst requiring a sizeable site (for storing pre and post chipped material), preferably under cover to maintain product quality and avoid disturbing the neighbours with wood dust.

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9.0 Policy Considerations

9.1 Policy Context

This section gives further consideration to the policy actions in light of the identified constraints and opportunities set out in the previous section. As previously noted through the report, priority must be given to the development of the collection infrastructure in light of the presence of major reprocessors and end market manufacturers already present in the region.

Rationale for Intervention

In terms of the more general rationale for intervention, clearly due consideration needs to be given to the following factors:

„ The increasing cost of landfill and limited capacity (albeit cheaper and more plentiful supply than elsewhere in England); „ The importance of promoting resource efficiencies, both in environmental (reduced impact on the environment) and economic terms (contribution to profitability); „ The need to reduce the impact on the environment generally and the specific need to reduce carbon emissions (important contributions can be made in terms of promoting biomass and other carbon neutral measures); „ The need to work with the market but also to recognise and adjust for accepted ‘market failures’ not least in relation to the environment which is treated by the market as a ‘free good’. Hence, there is a strong rationale to measures that correct for such market failures – through price mechanisms and financial support to the environmental goods and services sector; „ The economic significance (in employment, wages and GVA) and potential environmental contribution of the wood sector (set out in Regional Economy section), and the recycling sector more generally; „ The potential impact that can be made in policy terms (vis-à-vis other sectors) given: a) the significant investment required in the wood and other recycling sectors required to meet recycling targets; and b) the additional leverage of WRAP resources; „ The significance of the wider wood sector in relation to the rural economic development, a priority for the RDA in light of the more longstanding contraction of employment in agriculture and the rural economy; „ The potential regeneration contribution not just in terms of the rural economy, but also the development of social enterprise (which is significantly represented in the recycling sector), the benefits to business (regardless of location) and finally, the creation of employment opportunities that can be filled by local people – in some instances also providing opportunities to tackle social exclusion.

Role of the RDA

The RDA’s stance is critical since it sets the overall policy context and prioritisation, plus funds many activities in the region including significant funding of the Sub-Regional Partnerships.

ONE NorthEast has identified nine priority sectors: Food & Drink; Health and Social Care; New & Renewable Energy & the Environment; Automotive; Defence; Knowledge Intensive Business Services; Manufacturing; Tourism and Creative Industries. Environmental Technologies is an important aspect as it cuts across many sectors over and above the nine identified priority sectors. The nine priority sectors focuses mainly on the here and now development of the North East industries with the Three Pillar activity concentrating on long term high value strategy for future long term growth. Environmental Technologies is very much part of the Energy Pillar focusing on the former through the New & Renewable Energy Centre (NAREC) based in Northumberland. The RDA has previously, with match funding from the Objective 2 programme, supported a ‘Cluster Strategy’ for the Environmental Technologies sector. The programme was delivered by the Environmental Industries Federation (EIF), a former business-led and membership driven organisation.

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Some RDAs have even gone as far as adopting carbon emission as one of their key performance indicators (notably Yorkshire Forward). This provides an even more supportive policy context for promoting and supporting environmental technologies and recycling more generally.

Delivery Capacity and associated issues

The nature of wood recycling also raises the issue of the extent to which it is either feasible or desirable to isolate policy actions relating to wood specifically as opposed to the recycling sector more generally. This is not least because of the degree of overlap, especially for example in relation to collection infrastructure where organisations will be involved in collecting several recyclates.

Hence, while the focus in this report is specifically on wood, it would not be sensible to focus on wood recycling in isolation from the wider recycling sector, and also the most appropriate delivery vehicle in the North East. ONE NorthEast are in fact taking a more holistic view of the sector.

Further consideration is given to these issues below, although clearly as noted it is important that the issues relating to the development of wood recycling in the region are set against this wider background, overall RDA objectives and particularly the capacity to promote supply chain / market development.

9.2 Collection & Sortation Infrastructure

Although Collection and Sorting activities are not particularly high value-added, the region will not be able to harness the higher value jobs without growth in the supply chain. For instance, the additional high value jobs at UKWR are dependent upon securing local supplies without displacing existing customers for material. Priority is therefore attached to developing the collection infrastructure.

Developing Social Enterprise

There are a reasonably significant number of social enterprises involved in the recycling sector, largely focused on the collection of recyclates. Social enterprises harness entrepreneurial drive to achieve wider social objectives. In doing so, social enterprises tackle social exclusion and regenerate deprived communities helping to contribute to the creation of a more inclusive society. Broad political support exists for the sector to realise its full potential. The RDAs are generally supportive to the sector and ONE NorthEast has provided support for the North East Social Enterprise Partnership bringing together providers in the field to support social enterprise opportunities.

There are therefore opportunities to address issues relating to the collection infrastructure through targeted support to established social enterprises. This would further help realise wider environmental and community regeneration objectives.

Of interest in this context is:

„ The North East Social Enterprise Partnership (NESEP), established in spring 2003 by some of the leading social economy support organisations in North East England. NESEP is working to create a vibrant social enterprise sector and could be a useful partner in the delivery of assistance. „ Resource Network North East (which replaces the Community Waste Network North East) brings together voluntary and community organisations working on waste issues throughout the region. A regional database of the groups involved in recycling has been established to facilitate contact between them. „ The Groundwork Trust. A federation of Trusts in England, Wales and Northern Ireland. Each works with local partners to improve the quality of the local environment, the lives of local people and the success of local businesses in areas needing investment and support. Groundwork North East is the regional office serving five Trusts in East Durham, West Durham, Northumberland, South Tees and South Tyneside. Groundwork is involved in a wide range of regeneration activities including delivery of environmental employment programmes. For example, Groundwork are involved in running kerbside collection schemes.

The box below lists some social enterprises in the North East of potential interest.

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Social Enterprises involved in Wood Recycling/Reprocessing in the North East

ƒ East Ashington Development Trust ƒ Federation of City Farm and Community Gardens ƒ HEAP Community Composting Project ƒ Seymour Trust ƒ Rotter Community Composting ƒ St Aiden’s Community Trust ƒ Consett YMCA ƒ Blyth Star Enterprises

Case Study Illustration : Blyth Star Enterprises

Over the last 15 years the organisation has been utilising waste wood and wooden pallets collected from various sources to provide kindling to local garages. The organisation employs people with mental health problems. The organisations aims to: ƒ Meet the needs of people who, on recovering from mental illness, have identified the necessity to learn or re-learn life skills in order to achieve their optimum potential. A rehabilitation package will be offered at various levels in order to meet differing individual requirements and their desired outcomes within a community setting. ƒ Serve those in the community who, due to mental health problems need specialist counsel, support, education and advice whilst still enjoying the benefits of community living as opposed to that of an institution. The Kindling Project, based in West Sleekburn, Northumberland, only uses FSC certified timber to produce kindling and logs to the general public and national companies. The kindling project began in 1987. Demand has steadily grown, and a number of staff are now employed, assisted by service users, to meet the orders. The aim is to supply nationally 200,000 bags of kindling per annum and continue to meet the needs of local customers.

Support Collection Infrastructure – industrial & commercial waste

Mention has previously been made of private sector skip hire and collection schemes. Further encouragement needs to be provided to expand capacity here. This might be achieved through grant support towards the costs which would help minimise levels of risk. Hadfields for example, currently operate a scheme along the M62 corridor – however here the economics of operation are more favourable reflecting the density of businesses. They are also able to combine collection and product delivery.

To increase collection services suitable for the construction, commercial and industrial sectors those sectors must first be encouraged to segregate waste on site ready for collection i.e. through the introduction of Site Waste Management Plans (SWMPs). There is the potential to use existing bodies to deliver a marketing campaign for SWMPs i.e. Construction Excellence with support from bodies such as Envirowise, NISP and Recycle at Work advisers.

WRAP are currently working with construction clients, developers and main contractors to set requirements for implementing Site Waste Management Plans, at good and best practice levels, and the actions generated by those plans for major construction projects. To support the realisation of these requirements WRAP are

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developing Guidance and templates and running in-house training for major contractors. There may be the potential for ONE NorthEast to propose a regional marketing campaign around SWMPs and/or set up demonstration trials on site and work in partnership with the relevant bodies, including Construction Excellence, the WRAP construction team and Envirowise. Research is also currently underway at WRAP looking at C&D waste i.e. the quantities of waste going into Materials Recycling Facilities (MRF’s) and recycling levels being achieved by these facilities. This will cover the waste stream as a whole, including C&D wood waste.

9.3 Supply Chain Development

Mention has previously been made of the need to consider the development of wood recycling within the context of supply chain / market development initiatives for the recycling sector overall, not least because of the degree of overlap particularly in relation to collection infrastructure. In this context Enviros 29 have prepared for ONE NorthEast a ‘Regional Recyclate Market Development Action Plan’ and actions for the wood sector need to be considered in this wider context.

9.4 Recycle at Work

Considerable opportunities arise as a result of the recent recruitment of a Recycle at Work Adviser by WRAP who is based at ONE NorthEast. The role of the adviser will be to assist SMEs to recycle waste including wood and connect recyclers with potential suppliers. It is likely that this role will further identify constraints, opportunities and potential interventions.

WRAP have commissioned work which will further inform the needs and barriers of facing SMEs wishing to recycle more. This will include identification of areas where support there are gaps in the availability of service provision.

The Recycle at Work advisers will have a role in supporting increased collections and developments to the supply chain.

9.5 Land Premises

The North East has been successfully regenerating its urban areas. This has inevitably resulted in a degree of displacement as higher value uses out-compete lower value ones for land, including recycling. There is a need to ensure the availability of well placed serviced sites that are suitably located in areas where they will not conflict with neighbouring uses and access is good.

This raises the question of the merits of identifying sites dedicated to recycling – such as recycling villages. These would bring together different material companies – mainly collection / sortation and possibly reprocessors as well. There are opportunities here to combine this with the promotion of good practice. A potential benefit of a dedicated recycling park would be the potential for shared infrastructure to be used by groups of companies. This could be occasional use equipment or transport systems, for example.

9.6 Promoting Good Practice in Construction & Land Remediation RDA spend is quite heavily skewed towards physical renewal and investment in land remediation, growth and development. This raises the potential of RDAs to directly influence the demand for recycled products through tenders and specifications.

Opportunities arise where brownfield sites are remediated, especially for open space but also residential uses with gardens and landscaping. Depending on local availability of materials, this can create demand for waste derived compost for a variety of end uses including soil improvement, manufactured top soil and mulch. Additionally, there are a range of recycled products, including plastics and wood-plastic composites that can be used in landscaping.

Development – either to regenerate communities or to build new ones – also raises the prospect of promoting sustainable construction, including the use of recycled and secondary aggregates and other building materials with recycled content in buildings and highways.

29 ONE NorthEast. Regional Recyclate Market Development Action Plan, Enviros, Draft Report, May 2006.

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This should be linked to the activities and priorities of Construction Excellence North East (CENE) which has been established to showcase innovations and spread best practice in construction. One of CENE’s aims is to bring clients, industry and government, together to share best practice.

9.7 Procurement Sustainable procurement has become more prominent in Government policy debate. The National Procurement Strategy sets targets for every local authority and advises that they should use their purchasing power to create market demand for recycled materials or products.

Whilst the market share of recycled products in conscious procurement is currently low, there is substantial scope to increase the demand for recycled products through procurement. In relation to wood this includes opportunities for:

Public sector procurement has a major role to play, particularly in relation to: „ Landscaping „ Biomass

In this context the North East was known to be examining the possibility of establishing a ‘Regional Procurement Executive’ (RPE).

9.8 Education, Training and Awareness

Education Education programmes are required at the following levels: „ Local Authorities to know what they can extract from the waste stream and where they can send it; „ CA site staff to separate different grades of wood waste and forward it to the highest value end user for that material; „ Businesses to know what they can do with their wood waste – and why it is in their interest to do so; „ The public to know what wood is contaminated (e.g. potentially CCA treated garden timber) and to keep panel board products separate from solid wood.

Awareness & Marketing This could be accompanied with training materials that could be used by local authorities and industry to better segregate wood waste to the specification of local users and that addresses some of the barriers identified.

In addition to providing services and support it is important to raise awareness across all business sectors and particularly the SME sector, of the advice and facilities available such as the Recycle at Work adviser, NE Recycling Forum etc. This should be undertaken in conjunction with the ONE NorthEast BREW network.

As part of this general theme, ONE NorthEast could give consideration to initiatives designed to promote greater networking within the business community. This includes more general marketing which could be promoted in conjunction with a dedicated website and advice to connect demand for recyclate to supply. For example, RecycleWood is an interactive resource produced by WRAP to help producers of wood waste find collection services and recycling facilities and to link potential buyers of recycled wood products to suppliers.

This approach is similar to what NISP have achieved in lining up supplies from Sita and John Wade to UKWR. During this study we were also able to match up private and public sector bodies with potential customers for various grades of wood waste, indicating that there really is a need for such an initiative in the region. This could cover multiple waste streams.

Skills and Training Mention has previously been made of skills shortages / technicians. Further research is probably required here to validate this view. This sensibly might look beyond wood to the recycling sector as a whole.

Depending on the outcome of this research there may be implications in terms of education, training including involvement of relevant skills agencies.

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9.9 Further Research - Wood Waste Data

There have been several attempts at assessing how much waste wood is generated in the region each year, but to date these estimates have been broad and sometimes subject to contradictory evidence.

Municipal Waste There is reasonable data on what wood waste has been extracted from the municipal waste stream for recycling, but not what has gone on to landfill.

There are several parties interested in identifying more material to divert – including: - South Tyneside Recycling Village - UK Wood Recycling Ltd - UK Pallet Energy Ltd

We would suggest that ONE NorthEast works with these bodies to set up practical assessments of the volume and type of wood waste which is currently going to landfill. This may mean funding sorting and education trials at Civic Amenity sites and bulk waste collection transfer stations. However, sorting activities at CA sites could potentially be limited due to restricted site access and issues with space on site.

Introducing bulky waste collections of wood is not a plausible option for Local Authorities if wood alone is collected and without a suitable return based on tonnages and proportions of wood suitable for recycling. This is an area which could benefit from further research.

There is an opportunity to recover more waste from Civic Amenity sites but this should reflect wider recycling rather than just wood. Recovery should be driven through higher recycling targets and LATS targets for Local Authorities.

Commercial & Industrial Waste/ Construction & Demolition Waste A more thorough survey of skip companies and wood recyclers in the region would identify what quantities of C&I/C&D are already being diverted, but identifying the quantities currently going to landfill which could be recycled is more difficult, not least because the companies generating wood waste are mainly SMEs.

We would suggest starting by analysing the sectoral structure in the region and targeting specific industries to track down a) what quantities and types of wood waste they generate and b) where this waste currently goes. For example, all the public sector maintenance companies could be targeted to identify their wood C&D waste.

Survey results could be scaled up in proportion to the numbers working in the region in that sector.

Where possible, trade bodies should be used to reach the individual companies and there may need to be local radio/newspaper advertising – perhaps with an incentive such as a prize draw – to get SMEs to participate.

Companies within the wood recycling sector, such as UK Wood Recycling and Wood Pallet Energy UK have an interest in this research, hence working in conjunction with them is an option.

Arboricultural Wood Waste Knowledge in this area of wood waste is predominantly opinion rather than scientifically based. Further research is required – possibly in conjunction with Northwoods – to ascertain a more accurate picture of regional arisings and the feasibility of introducing Tree Stations to capture such waste and divert it from its current nil-value uses (in situ or as mulch in internal markets) to biomass fuel manufacture.

Matching Waste to End Uses Having conducted a thorough audit of wood waste streams in the region, the types of wood could be quantified and matched against different end uses: A grade Æ high value and panel industries B grade Æ a little to panel industries C grade Æ energy D grade Æ landfill

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10.0 Conclusions & Recommendations

10.1 Conclusions

Wood-based industries are of slightly more importance to the North East region than to England as a whole: the region hosts 5.62% of wood industry employment but only 5% of England’s population. The sector provides 370 jobs and contributes £5 million to regional GVA.

The wood recycling industry in the region employs an additional 33 (set to rise to 73) and contributes an additional £446 thousand to regional GVA.

Our best estimates of waste wood arisings in the region are as follows:

Table 10.1.1: Summary of Best Estimates of Wood Waste Arisings in the North East Reprocessed/ Arisings Recovered Landfill Other Municipal 77,000 16% 27,200 49,800 Commercial & Industrial 145,000 31% 39-64,000 81-106,000 Construction & Demolition 246,000 53% 50,000 196,000 Sub-total: 468,000 116-141,200 327-352,000 Arboricultural 100,000 - - 100,000 Agricultural Negligible 568,000 116-141,200 327-352,000 100,000 Source: ESYS

Some of the Reprocessed/Recovered tonnes are ‘exported’ out of the region, whilst ‘imports’ in to the region amount to around 111 thousand tonnes per annum currently.

End users of waste wood in the region are using around 205 thousand tonnes per annum, have capacity to use 324 thousand tonnes and have planned capacity expansion to 549 thousand tonnes in the next few years.

In addition to this apparent regional shortfall in supply of waste wood, shortfalls of competing materials of forestry and saw mill co-products across the North of England and Scotland are forecast as follows:

Northern England & Scotland Shortfall of Supply, 000 tonnes pa: 2007 2012 2016 Sawmill co products: 710 1,787 1,722 Forestry timber: 649 6,084 4,863

The end use industries for waste wood are mainly panel board manufacturing, biomass fuel (wood chips or pellets) production and higher value products (such as animal bedding or landscaping materials).

Egger dominate the panel board industry in the North East and already have major expansion planned for the volume of waste wood they use. UK Wood Recycling are the major biomass producer, supplying SembCorp’s Wilton 10 Power Station on Teesside. UKWR also have 120,000 tonnes of additional capacity and have plans to produce sister company Hadfield’s higher value products with this capacity.

The picture painted is that the region all ready has end-market capacity far in excess of supply chain capacity. Hence the Policy Considerations and Recommendations in this report concentrate on building the supply end of the industry.

10.2 Recommendations

The study recommendations should be read in conjunction with the Policy Considerations (chapter 9) and are as follows:

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„ Recycling Sector Approach

Consider the development of wood recycling in the region in the context of actions to develop the wider recycling sector more generally. This reflects the degree of overlap, especially for example in relation to collection infrastructure where organisations will be involved in collecting several recyclates.

„ Policy / Sectoral Priorities

The RDA to reconsider the current sectoral prioritisation given that there appears to be a strong economic and environmental case for including recycling and the environmental technologies sector more generally.

„ Investment Focus

Prioritise actions aimed at developing the collection / sortation infrastructure both through support for relevant social enterprises in the region and specific assistance to encourage investment in infrastructure to encourage collection from commercial and industrial sources. The former to include discussions with: the North East Social Enterprise Partnership (NESEP), the Resource Network North East and Groundwork Trust.

„ Collection Infrastructure

In particular, actions need to be taken to encourage growth in collection capacity in the region. This can be broken down as follows: o Diverting more from municipal waste by educating both HWRC site staff and the public on material separation and recycling/recovery routes; o Investigation in to extracting more from bulky waste collections for recycling. Currently a large proportion of such collections go straight to landfill instead of being separated and materials recycled where possible. o Collection service provision suitable for the construction, commercial and industrial sectors. This may require investment in additional vehicles and/or containers. Whether investment is required in developing sites/facilities depends upon whether recycling service providers are performing any sorting/reprocessing themselves.

Lease of equipment via eQuip may be an option to support these measures (although it should be noted that eQuip is not available for firms planning on manufacturing fuels from the recycled materials). Alternatively regional regeneration funding might be appropriate.

The main users of waste wood in the region are Egger, UKWR and WPEUK. A collection service delivering directly to any of these would need to have a quality-assured service. Alternatively the collected materials would need to go through primary reprocessing – such as via Reivers Reprocessing Ltd. However, the latter have limited capacity and hence there could be a need to encourage additional reprocessing facilities as well as collection services.

„ Implementation

ONE NorthEast have commissioned Valpak to undertake a study with the express objective: “to recommend and detail a delivery model for an initiative that will provide business support to the recycling and reprocessing sector in the North East, to enable it to expand, develop and capture the maximum share of the market to provide the greatest economic impact.”

„ Actions to promote wood recycling

o Promote investment in the collection infrastructure (as noted above).

Regional Market Assessment for Wood Waste for North East England 88

o Maximise opportunities / address constraints arising out of the Recycle at Work advisers and studies, including greater degree of networking with businesses and specifically with key players developing / expanding wood processing facilities in the region.

o Consider merits of dedicated recycling village / park initiative, including extent of benefits arising from shared infrastructure.

o Education, training and awareness measures to promote wood recycling. o Promote greater networking in the business community. This might include general marketing plus consideration be given to a dedicated website with advice and facility to connect demand for recyclate to supply sources.

o Research into reported skill shortages with involvement of relevant skills and training agencies. o Promoting good practice in construction / wood recovery by building on established regional initiatives such as CENE.

o Creating demand through Procurement initiatives. This includes public sector procurement (especially in relation to landscaping for example), but also influencing the private sector through for example initiatives like London’s Green Procurement Code.

„ Further Research

There is still a need to clarify how much waste wood is generated in the region each year including identification of constraints to collection experienced.

There is also potential for further research in to the potential for Local Authorities to provide more bulky waste collections of wood and other materials, what tonnages of materials suitable for recycling (including wood) could be retrieved from such collections and what returns the Local Authorities could expect from these recyclates.

Having conducted a thorough audit of wood waste streams in the region, the types of wood could be quantified and matched against different end uses:

- A grade Æ high value and panel industries - B grade Æ a little to panel industries - C grade Æ energy - D grade Æ landfill

Regional Market Assessment for Wood Waste for North East England 89

Appendices

Consultees & Bibliography

Company Name & Position Alex Smiles Ltd Alistair Newton Durham Environmental Partnership Richard Jackson Edgar F Shepherd Ltd Nigel Egger (UK) Limited Mark Hayton Egger (UK) Limited John Patterson EIF/NERF Pam Jose / Jo Bennison Forestry Commission Brendan Callaghan & Alan Corson H Eggleston & Son Ltd Simon Eggleston Newcastle City Council Mark Manley & Terry Harnan Northumberland County Council Clive Fagg ONE NorthEast Ray Waters ONE NorthEast Chris Maxwell Reivers Geoff Hornsby Renew Tees Valley Paul Jackson SITA Guy Evans Commercial Manager re Tees Authorities SITA Steve Wake re I&C SITA Esther Craister re North Tyneside South Tyneside Council Andrew Whitaker Sunderland Council Peter Kirkbride & Fiona Swinbourne SWS Ltd Mark Penny Thompsons of Prudhoe Ryan Molloy & Aubrey Telser UKWR Vicki Hughes & Geoff Hadfield Urban Harvest Ltd Toby Beadle, MD Wood Pellet Energy UK Kevin Owen, MD WPIF Alistair Kerr Premier Waste Management Ltd Randy Dee, Recycling Manager

Report Author Date A report into the availability and suitability of the timber resource of By Phil Royal for NCC & Newcastle City Council and an exploration of its possible uses Northwoods Aug-04 An Independent Study Looking at Specific Issues Relating to the Wood Panel Industry and The Renewables Obligation For DTI by Jaako Poyry Sep-05 CONFOR newsletters & web articles Egger Connect Magazine Jul-06 John Clegg Consulting Ltd, on Forecast Wood Availability & Demand in Scotland & Northern England to behalf of the Wood Fibre 2016 Processing & Supply Industry Nov-06 FORESTRY FACTS & FIGURES 2006 - A Summary of Statistics About ISBN: 0 85538 Woodland & Forestry The Forestry Commission/ ONS 706 8 2006 Identification of Feedstock Specifications for UK Wood Recycling Applications& Examples of Good Practice in Their Achievement by Urban Harvest Ltd for WRAP Jul-03 National Inventory of Woodland & Trees - Regional Report for North East England The Forestry Commission/ ONS 2002 Recycling Waste World: "Thinking Outside the Box on Wood Waste" Miles Brown of TRADA 23/11/2006 Regional Recyclate Market Development Action Plan by Enviros for ONE NorthEast May-06 By CEBR Ltd, for Confor and the The economic contribution of the forest industries to the UK economy Forestry Commission Jun-06 WOO0017: Characterisation of Emerging Higher Value Markets for Recycled Wood Products by Urban Harvest Ltd for WRAP Jun-04

Regional Market Assessment for Wood Waste for North East England 90

WOO0040 - Emerging Higher Value Markets for Recycled Wood Products – Market Opportunity Study by AMA for WRAP 27/06/1905 ESYS Consulting Limited for WOO0055 - Recycled Wood in Equine Bedding – The Commercial Case WRAP 01/06/2006 WOO0041 - Reference document on the status of wood waste arisings and management in the UK MEL Research Ltd for WRAP Jun-05 by Northwoods for Northumberland County Council SOUTH EAST NORTHUMBERLAND WOODFUEL RESOURCE STUDY et al Jul-05 A report into the availability and suitability of the timber resource of For Newcastle City Council & Newcastle City Council and an exploration of its possible uses Northwoods, by Phil Royal Aug-04 by BioRegional for the Carbon Woodchip Production from Tree Surgery Arisings in Croydon Trust 2006

Regional Market Assessment for Wood Waste for North East England 91

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