Waste Management Investment Post-COVID: Uncorking the Bottle

As we move into the second half of 2021, the COVID-19 pandemic continues to cause a number of serious difficulties and challenges for the waste management industry. In 2020, patterns of waste generation were suddenly and severely affected, as normal economic and social activity was curtailed around the globe on an unprecedented scale. Waste operators had this to deal with, as well as the challenge of providing acceptably normal services in an environment of reduced staffing and strictly enforced social distancing. Work on expansion and development of new plants became far more challenging, as contractors faced shortages of staff, equipment and building supplies, and necessary regulatory permissions were delayed as government departments ceased to function properly.

Amid the ongoing gloom, however, there is plenty of good news. People haven’t stopped generating waste, even if the mix and nature of that waste has been altered. In some ways, the pandemic has merely accelerated longer term changes. To give one example, home working has been an increasingly viable and attractive option for many people for some time now, but the pandemic made it an urgent necessity. While a lot of businesses are reopening, home working is likely to remain at far higher levels than pre-pandemic. For the waste industry, that means more ‘residential’ waste collection, and less from city centres and businesses.

Where effects have been negative, they are likely to be short-term. Recycling activities were hit in 2020, either because they became more difficult to do, and/or they became commercially unviable. This is surely a short term phenomenon; surely, regulatory and environmental pressures will quickly reassert themselves in the longer term. Larger projects, such as in the WTE sector, have been beset with delays, but the initial pressure for them to be completed remains.

At AcuComm, we see this in the real world. Interest in new waste investment across the world remains strong. The graph below shows the number of new projects and investments announced each month between January 2018 and June 2021. It’s hard to see any COVID effect at all here.

ANDY Uncorking the Bottle

Source: AcuComm database, July 2021

How can we best interpret this graph, in the light of what we know? There is clearly an ongoing need, and willingness, to invest in better and expanded waste facilities around the world. But of course, just because a project is announced, does not mean it is up and running, or that it will be operational according to the original schedule. So it looks like we currently have a logjam… the past 18 months has seen a growing backlog of investments which have yet to become operational. As the world recovers, confidence will return and the cork will come out of the bottle, allowing activity – rather than announcement of activity – will return. That will create its own logistical challenges of course (as any logger will tell you), but for the industry it will perhaps be a welcome problem to have after more than a year of uncertainty.

Of course, recovery won’t be at the same pace everywhere, and different sectors of the market will face differing challenges (see the October 2020 AcuComm paper, ‘Waste Investment Trends 2020+ Assessing global performance in the shadow of COVID-19’ for more detail on the varying reginal and sectoral effects). There’s an opportunity here for the waste industry to ‘build back better’, to coin a phrase, by making greater use of smaller, more efficient facilities with more modern technology. Smart companies and investors will already be planning ahead in order to thrive in a world where much has changed, but much really has not.

Assessing global performance in the shadow of COVID-19

The Covid-19 pandemic has affected all sectors of the global economy in 2020. Just how much the waste industry has been impacted is the subject of a new study from AcuComm which analyses data drawn from its waste investment database. The study assesses how the industry is faring against the background of restrictions and economic disruption, with an emphasis not on the immediate dislocation to industry operators, but on the longer term effects on planning and forward investment.

Monthly trends, sectoral variations and the performance of the top 35 waste markets are examined, establishing where investment is continuing to grow and where activity is declining. The study’s author, AcuComm’s Chief Analyst, Andy Crofts, pinpoints the winners and losers by analysing the current year against AcuComm’s proprietary monthly data going back to 2016 and provides his insight into the degree to which growth or downturns are the result of cyclical trends or the pandemic.

For details of how to obtain a copy of Assessing global performance in the shadow of COVID-19 (AcuComm, October 2020), please contact:

Rob Thompson

+44 (0) 7399 863 765

[email protected]

or

Oliwia Mroczkowska

+44 (0)7399 863 806

[email protected]

 

 

Municipal Waste Disposal Services in Greater Manchester: dealing with COVID-19

Greater Manchester, with a population of around 2.8 million, is one of the UK’s single largest areas for waste disposal. In 1986, the Greater Manchester Waste Disposal Authority (GMWDA) was created, covering most of Greater Manchester[1]. In 2018, the activities of the GMWDA were made part of the more general Greater Manchester Combined Authority (GMCA). The leading provider of waste services for the GMCA is now Suez International, which has replaced Viridor. The company signed an initial seven-year contract with the GMCA in May 2019[2].

The Greater Manchester area generates around 1.1 million tonnes of waste each year. This figure has not changed much over the past five years. In 2018/19, around 47% was recycled or composted, up a little from 43% in 2014/15. The biggest change has been regarding landfill. In 2014/15, Greater Manchester sent 30% of waste to landfill, equal to 331,861 tonnes. By 2018/19, this had fallen to 8%, or 85,643 tonnes. Much of this now goes to WtE incineration. This accounted for 44% of waste disposal in 2018/19 (496,692 tonnes), compared with 25% (269,861 tonnes) in 2014/15.

Andy - Manchester 2
Source: DEFRA

Waste Facilities

There are now no active landfills in the area. The GMCA continues to maintain four closed sites, but the majority of old sites were sold off for redevelopment in 2012[3]. As noted above, landfill tonnage has reduced considerably, and what remains is presumably freighted outside the area for disposal.

Residual waste is first taken to one of five Mechanical Treatment and Reception facilities. These are located in Oldham, Salford, Sharston and Stockport, as well as Manchester itself[4]. These sort waste and create RDF, which is taken to the Runcorn facility (see below).

Greater Manchester maintains one WtE incineration facility, at Raikes Lane in Bolton. This is an old facility, first built in 1971 and modernised in 2000. It generates up to 11 MW of electricity and has annual capacity of around 100,000 tonnes[5].

This is only around 20% of the total WtE registered for Greater Manchester. The bulk of the rest is sent to the Runcorn Energy From Waste Plant. This is in Cheshire, outside Greater Manchester. The site is managed by Viridor and opened in two stages in 2015. It can treat around 850,000 tonnes of waste annually, and generates a maximum of 80 MW of electrical power.

Finally, the GMCA maintains a Materials Recovery Facility, located at Longley Lane in Manchester. This can handle 90,000 tonnes of pre-separated recycling waste per year, and sorts glass, metals and plastics.

Andy - Manchester 1
Source: GCMA/AcuComm database

COVID-19: Lockdown challenges

The effects of the COVID-19 lockdown have been affected in two principal ways, as SUEZ seeks to implement the necessary social distancing rules. Firstly there are fewer household waste collections. Domestic waste collection across Manchester typically entails one general waste collection per week, plus fortnightly collections for paper, metal/glass/plastic, and garden/food waste. Under the COVID-19 restrictions, the weekly general collection remains, but recycling collections are now only monthly, and weekly garden/food waste collections have stopped altogether.

Secondly, as of March 23rd, all 20 public recycling centres across Greater Manchester have been closed, until further notice. Individuals and tradesmen are no longer able to take garden waste or bulky items to be disposed of.

It is far too early for statistics to appear, but there are sure to have been major changes in the composition of waste. With more people at home more of the time, the volume of domestic waste can be expected to rise, counterbalanced by a major, and probably far greater, fall in waste from businesses, shops and restaurants. Within the domestic sphere, recycling levels are likely to fall, as people put more of their recyclables into their regular bin, instead of the recycling bin (fewer collections) or taking things to the recycling centre (closed). While the overall level of waste generation is probably falling during the lockdown, dealing with these changing geographic and waste-mix patterns is a challenge for waste companies and managers.

There are other knock-on environmental effects too. The ban on food waste collections had to be briefly lifted, as councils realised that indefinitely leaving rotting food in people’s bins is a potential public health hazard. Noticeably more people have been having bonfires in their gardens, seemingly to get rid of garden waste that is not now being collected. We can probably expect a rise in fly-tipping, as people have no easy means of disposing of bulky or difficult-to-dispose-of items. As I write, there is some vague talk of a partial reopening of recycling centres, probably for those very reasons. Finally, more people are doing their grocery shopping online, and this is leading to a resurgence in single-use plastic bags, as these are the best way to deliver shopping in the days of social distancing. I am sure there will be other, as yet unforeseen, consequences.

These sorts of restrictions and challenges are of course not unique to Manchester; they apply to urban areas across the UK and indeed the developed world. When economies come out of this emergency, many things are going to look very different, and the waste sector cannot expect to remain unaffected.

[1] The town of Wigan is the only part of Greater Manchester to continue to manage its waste disposal separately.

[2] Suez press release https://www.suez.com/en/news/press-releases/suez-supports-the-greater-manchester-in-its-waster-management-services-for-an-amount-of-over-one-billion-sterling

[3] GMCA https://zerowastegm.co.uk/energy-and-waste-management/landfill-aftercare-2/

[4] GMCA https://zerowastegm.co.uk/energy-and-waste-management/mechanical-biological-treatment-facilities/

[5] https://recycleforgreatermanchester.com/wp-content/uploads/2017/03/TRF-Case-Study-R4GM-Higher-level-fact-sheets-August-2014_Layout-1-2.pdf

Andy Crofts: Chief Analyst, AcuComm

Covid-19: AcuComm Services continue unchanged

Dear Customer,

There is considerable concern related to the developing Covid-19 situation with many companies facing operational challenges.

As an advanced digital information company AcuComm’s operation has always accommodated remote home-office working by our staff and consultants.  Therefore, in the current circumstances, I do not envisage there will be interruption to the maintenance and delivery of your AcuComm service.

We will continue to monitor developments and will contact you in the event of any change.  If you have any specific questions then please contact me directly.

Yours sincerely

Kimberley Wigart

Managing Director