Landfill firms face burning questions


Waste management by Nick Mathiason


IN MUCKING, Essex - 35 miles east of London on the banks of the River Thames - thousands of seagulls greedily peck at waste rotting in the earth.'

When the birds are disturbed by synchronised industrial diggers spreading newly arrived waste into a mound, a blizzard of gulls rises above the binbags. .

Spanning a vast 450 acres of landfill, Mucking is London's dumping ground.Nearly a fifth of the Capitalís waste is taken on barges to what is the eerie underbelly of our throwaway society.

The trouble is, the appropriately named Mucking - like many landfill dumps is on its last legs.New European legislation has forced Britain to dramatically reduce the amount of rubbish sent to landfill.From 2007 when its licence expires there will be no more barges arriving at its wharf.

Barges sailing to the site at present save 440 lorry journeys each day, says the company that runs it, Cory Environmental - a subsidiary of FTSE 100 logistics giant Exel.

The capital had better prepare itself for those s giant lorries because when Mucking shuts there will be no replacement.At the very earliest, it will be 2008 before a replacement using river transportation is built.Add in the increasing lorry movements taking - recycled bottles, cans, and paper and London has a looming transport crisis.

The fate of Mucking's replacement - a giant £100 million incinerator in Belvedere, Kent - is nowhere near a resolution. Cory first unveiled plans for the new incinerator 10 years ago.The plant would process 585,000 tonnes of rubbish each year and generate 72 MW of electricity - enough to power 66,000 homes after the plant's needs have been seen to. It will be one of the biggest ever built in Europe.

Last May, the public inquiry report said: 'The level of need for additional waste management facilities In the London region [is] such as to require an urgent decision on the contribution made by Energy from Waste (EfW) in the form of this present project.'

The final decision as to whether the plant goes ahead rests with the Department of Trade and Industry, which has had the public inquiry report for nine months.Last month it said it was mulling over new information that could be relevant to its decision.

Privately, Cory Environmental believes this is a stalling tactic and the government is waiting until after the General Election to make itís riling.The site is in a Labour marginal seat.

Not surprisingly, Bexley residents and its council are furious about the incinerator. A council official says that it resents having to take London's waste and that it believes the amount of rubbish processed at Belvedere will be far higher than currently disclosed.

And there are health uncertainties. Although a Department of Environment study last May signalled that emissions from EfW plants have no detrimental effect on human health and is far preferable to sending it to landfill, the Royal Society, the UK's national academy of science, insists that 'It is Important that anyone using the data [from the report] takes adequate consideration of its inherent uncertainty'. The Government has been forced to commission more work on this issue.

There are plans for 50 similar schemes across the country but only a handful have so far been built because of local opposition.The Institution of Civil Engineers last year said that Britain needs 2,300 new incinerators, composting and recycling plants at a cost of billions of pounds.

Just buying the sites is a massive problem. The waste management sector, which today is worth £5bn and growing, cannot compete with property developers when bidding for riverside sites.

But as Britain is forced to dramatically reduce its-rubbish going to landfill, the spectre of swingeing fines imposed on local authorities looms. If waste management targets arenít reached, fines will be levied on councils from 2010.

This - rather than climate change concentrated minds on a nationwide recycling drive. Recycling hit 14 per cent of household rubbish in 2003, but needs to get to 25 per cent this year to meet government targets. This seems unlikely

But this focus on waste minimisation and reduction has made it a golden age for Britain's waste management sector.And in the last 18 months, there has been a flurry of takeovers as the big players consolidate.

Severn Trent, the quoted water firm, recently paid £141m for rival waste contractor Hales from the RMC group. The deal increased the turnover of Severn Trent's waste division Biffa to £570m and lifts its market share to 12 per cent, putting it comfortably ahead of its nearest rival, SITA - owned by the French water giant, Suez.††††

The Hales takeover followed the £531m acquisition of Waste Recycling by Guy Hands, the city financier, through his buy out fund Terra Firma.

Shanks landfill assets were snapped up for £227.5m.

Hands is betting that where there's muck there's brass. And while revenues are increasing, the new processing facilities winning approval threatens future growth prospects and Britain's ability to meet environmental laws.