The temperature is dropping in Europe, both in terms of the temperature gauge and an economy affected by stagflation and ongoing warfare. Reduced trade activity means less availability of both household and commercial waste. And with a lack of waste, the supply of waste fuel for the many WtE plants around Europe - whose task of producing both electricity and heat is becoming increasingly important - is also falling.
More waste needs to be recycled
Last year, around 2 million tons of waste fuels (WDF) were imported into Scandinavia to meet the needs of energy recovery plants. The challenge today is that the demand for residual waste-to-energy is increasing due to more developed capacity and reduced waste volumes in Europe. Germany, the EU's largest producer of district heating and energy from RDF, has moved from being a waste exporter to an importer, and several EU countries are now 'hunting' for waste resources wherever they can find them. In the current situation, exporting countries such as Italy have been a significant contributor of RDF, thus preventing an even greater imbalance in the market.
The current lack of waste volumes has two main consequences: First, it creates uncertainty about the ability of operators to produce energy or recycle products as normal. The second effect is that sharply declining gate fees weaken the economics of many district heating plants. Market participants are used to fluctuations, but the current situation is pushing prices so hard that many plants are reducing production rather than using their maximum capacity in tonnage.
The situation is also a challenge in terms of sustainability. One example is the cement industry, which, in the absence of waste fuels, may have to produce energy using more polluting fossil fuels. Another is that all the waste that ends up in landfills creates large emissions of methane gases.
Landfilling waste is a major challenge
According to the European Commission, as much as 52 million tons of European household waste went to landfill in 2020. Given the current situation, it is hard to believe that more action is not being taken to make use of all the waste going to landfill in Europe. We know that in countries such as the UK, France, Spain and Italy, large quantities of residual waste are landfilled every year - waste that could be used as fuel in the midst of an energy crisis. And this is not only for economic and practical reasons, but also for purely environmental reasons.
We know that the EU is working on a long-term basis to stop environmentally harmful landfilling of different types of residual waste. But in times of crisis like these, we also see the need for swift, effective and, above all, international action in a Europe that has different approaches to the landfill challenge.
One way to divert more waste from landfill to recycling is to increase the tax on landfill to a point where it is more profitable to export the waste for recycling. Another is to subsidize the use of residual waste for sustainable energy recovery. Many would also argue that a reduction in incineration taxes would ensure that more waste goes to energy recovery.
At the same time, it is important that in times like these we remove the handbrake and facilitate the flow of waste between markets in Europe. Inflexibility and long processing times for waste exports are a noticeable bottleneck in the current energy crisis. This is where a common electronic system and fewer manual processes could make a difference.
Today, there is sufficient final treatment capacity in the EU to mitigate the impact of the energy crisis. We simply need to increase the recycling of waste that currently goes to landfill. In addition, we need to ensure that we develop new markets in both Southern and Eastern Europe that we know can help supply a recycling industry of efficient WtE facilities.
