UK: Structural Barriers Have Led to Wasted Opportunities

British recycling policy is based on outdated assumptions about resources, which reinforce an expensive, stagnating system: Recycling rates were up just 0.2 per cent between 2012 and 2013. (Photo: TiM Caspary  /

In contrast, a circular approach, focused on preserving the value of collected materials, could enable the private sector to deliver £2 billion of investment in recovery infrastructure, capturing £1.7 billion in material and reuse value each year. This is the key thesis of a new report from the Circular Economy Task Force, written by Dustin Benton and Jonny Hazell and published by the Green Alliance under the title “Wasted opportunities: smarter systems for resource recovery”.

The problem, says the paper, is structural. At a local level, decisions about recovery systems have been based on arbitrary political boundaries and made by councils not focused on material value. At a national level, a lack of central government strategy and common standards reinforces the wasteful system, rather than helping to resolve its inefficiencies. Pressures on council funding mean poor outcomes are likely to be entrenched, undermining existing recycling and new opportunities to reuse and remanufacture.

Addressing this structural problem requires a shift in thinking: Resource recovery should be based on preserving material value so that existing demand for high value recyclate and recovered parts can justify investment in reprocessing infrastructure. In practice, this means that collection and processing systems need to operate at a suitable scale to meet the needs of high quality reprocessors and remanufacturers.

Both: municipal and commercial collections

As the report shows, for some materials, like biowaste, a single council area is the right scale for operations. Central government could increase investment by raising recycling targets or implementing landfill bans with separate biowaste collections. But for materials like plastics and waste electronics, collaboration across many local authorities, using materials from both municipal and commercial collections is needed to provide UK refurbishers and reprocessors with a secure supply of quality feedstock.

Smarter and wealthier local authorities are beginning to collaborate, but most only do so to cut administrative costs rather than to improve the value of the materials recovered. Waste companies don’t have enough control over materials to create better systems, even where they can see the opportunities to do so.

Wrong assumptions

The UK’s resource management systems were never designed for a circular economy. Instead, they evolved from arrangements to transport waste to landfill that have two main characteristics. First, they were led by local authorities who based collections on their geography, rather than that of material flows. Second, the focus was on minimizing transport costs rather than a concern for the quality of the materials transported. Retrofitting recycling onto these systems has delivered limited gains: Just 30 per cent of plastic packaging is collected for recycling, two thirds of which is exported for reprocessing overseas. For waste electronics, just two per cent is reused, even though 23 per cent is suitable for reuse.

The characteristics of landfill based systems are now impeding more circular resource flows in the UK. Unlike landfills, much of the infrastructure able to capture value from waste demands material from multiple local authorities. And maximizing value is now more important than reducing collection cost: Disposal to landfill costs around £100 per tonne, whilst some waste streams are now worth £300 per tonne.

Source: Green Alliance

Source: Green Alliance

Unrelated to material flows

To capture value from waste, high quality recovered materials have to be delivered at sufficient quantity and quality to reprocessing facilities. But there are 376 waste collection authorities across the UK: The organization and scale of their collection and management activities is almost wholly unrelated to the quality and optimal flows of the materials they manage.

Uncertainty over the availability of feedstock means fewer reprocessing facilities are built than there is feedstock for. This creates a vicious circle: Reprocessors aren’t building infrastructure because feedstock isn´t reliably available at scale; councils and waste companies do not ensure the quality and consistency of recovered materials, because there isn’t sufficient infrastructure for reprocessing; and manufacturers, which could use the recycled content, are forced to go elsewhere for raw materials.

The result is that £1.7 billion worth of plastics, food and electronics is lost to the economy. If all this value could be captured by local authorities, council tax could be reduced by £61 a year per household.

Smarter system, better material recovery

The analysis of three major waste streams – electronics, plastics and food – exemplarily show how a smarter system can get the most from today’s wasted resources.

  • The UK could support eight to 16 generalist waste electronics recyclers recovering raw material value, as well as 50 to 200 reuse-focused reprocessors specializing in particular appliance types.
  • The UK could support around 45 high quality, closed loop plastics recyclers, up from the five that operate in the UK today.
  • The UK produces enough biodegradable waste to feed approximately 500 AD plants, but currently only has 135

Five dragging factors

Five factors are keeping market demand for recyclate and reused goods from stimulating investment in good quality reprocessing plants. Superficial localism: For example, in the UK few local authorities jointly purchase bins, and many insist on expressing local preferences through bin colour, embossed logos and the like. But the lack of joint procurement means each UK bin costs £5 more than a German bin.

Split incentives: Central government policy creates two types of split incentive which impede better recovery. First, collection authorities pay for collection, but may not benefit from the value of recovered materials. Second, the separation of municipal and commercial waste creates two parallel systems dealing with the same raw materials, encouraging unnecessary duplication.

Lack of central government strategy: A lack of central government strategy has sent mixed messages to local authorities, waste companies and reprocessors.

Misplaced competition: Waste companies compete fiercely on projects, driving down the cost of infrastructure. But the project specification is set by authorities thinking about waste within their boundaries, not the total value of the system, including the value of materials.

Risk aversion: Capturing the value of materials exposes councils to volatile raw and secondary material markets for long contract periods, adding uncertainty to the forecasting of council revenues and expenses. Budget cuts entrench these problems. Cuts could be a catalyst for a shake-up in resource management. But on their own they are more likely to entrench a poor system. This is because they make local authorities more risk averse.

Governmental options

Central government can help councils to resolve many of the factors preventing a better system from emerging. The most important action would be to plan recovery systems so they feed high value reprocessing at an economic scale. There are two ways of achieving this:

Option 1: Create a £250 million challenge fund for recovery infrastructure: This would include cross boundary assessments, funding staff to broker agreements and a seed fund for a financial stability mechanism.

Option 2: Designate some materials and associated infrastructure as nationally significant: As part of its infrastructure planning process, for materials like plastics and WEEE that are likely to require wider than local collaboration, the government could assess the need for reprocessing infrastructure and set associated collection standards nationally. As part of this process, the government should remove the arbitrary divide between commercial and municipal waste and copy the Danish system, which collects the same materials from both commercial organizations and households.

Moving to a more circular economy

The paper ends with the follow­­ing conclusion: “Addressing the structural barriers to high value recycling is the first step in moving the UK to a more circular economy. Once these barriers are removed, existing technology and business practices could very rapidly raise the UK’s stagnating recycling rates. Improving collection systems so reprocessors can preserve the value in materials and products would provide a path, beyond high volume but low value recycling, towards high value reuse and remanufacturing.”

The full report can be downloaded from