What is waste?
2.1
Waste refers to anything that is thrown out. The National Waste Report 2018 defines waste as:
materials or products that are unwanted or have been discarded, rejected or abandoned, including materials or products that are recycled, converted to energy or disposed.
2.2
There are various types of waste in Australia. For the purpose of this inquiry, waste refers to ‘core waste’, which is generally managed by the waste management and resource recovery sector.
2.3
Core waste is classified into three streams:
Municipal solid waste: generated by households or council operations (including waste collected in public places like parks and beaches);
Commercial and industrial waste: produced by institutions and businesses (including coal ash but generally excluding waste from primary production); and
Construction and demolition waste: produced by construction and demolition activities.
2.4
In addition to these three streams, waste may be classified as ‘hazardous’. Generally, this refers to waste that poses a threat to public safety or the environment.
Waste statistics
2.5
Of the estimated 67 million tonnes of waste produced in 2016-17, approximately half (49 percent) or 32.7 million tonnes was commercial and industrial waste (including ash). Construction and demolition waste made up 30 per cent or 20.4 million tonnes, followed by municipal solid waste which equated to 13.8 million tonnes or 21 per cent of waste.
2.6
Between 2006–07 and 2016–17, overall waste production in Australia grew by 6 per cent. During that period, municipal solid waste increased by 7 per cent, construction and demolition waste increased by 19 per cent, and commercial and industrial waste decreased by 1 per cent.
2.7
On a per capita basis, total waste decreased by 1.1 per cent, from 3.05 tonnes in 2006–07 to 2.74 tonnes in 2016–17. In other words, over the last decade the amount of waste generated by each person has decreased.
2.8
What happens to waste that is generated is described as its ‘fate’. Waste may be recycled, converted to energy, put into long-term storage (that is, for longer than 10 years) or disposed of. Hazardous waste often requires treatment before it can be safely allocated to a final fate.
2.9
Table 2.1 illustrates the fate of waste in Australian in 2016–17 (including treatment).
Table 2.1: Waste Fate 2016-17
|
|
|
|
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Recycling
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37.03
|
55.45
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Energy recovery
|
1.97
|
2.95
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|
Treatment
|
0.82
|
1.23
|
|
Long-term storage
|
0.02
|
0.03
|
|
Disposal
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26.94
|
40.34
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Total
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66.78
|
100.00
|
Source: National Waste Report 2018, pp. 92, 94.
2.10
Table 2.1 shows over half of all waste generated in 2016–2017 was recycled (55 per cent) while 40 per cent was disposed of, predominantly in landfill.
Waste management and resource recovery industry
2.11
The most recent comprehensive economic assessment of the waste management and resource recovery industry, undertaken by the Centre for International Economics, found the value of the industry’s activities to be $15.5 billion. Further analysis found:
$12.6 billion (81.3 per cent) of this was from service provision;
$2.9 billion (18.7 per cent) was from the sale of recovered materials;
industry activities contributed $6.9 billion, or 0.43 per cent of Gross Domestic Product, and
the industry employed the equivalent of 49 160 full time workers.
2.12
The Centre for International Economics found that ‘private and public trading waste management enterprises’ conducted 56.3 per cent of ‘waste related activities’, local councils conducted 19.9 per cent and companies in other industries conducted the remaining 23.8 per cent. In other words, approximately 80 per cent of waste management and resource recovery in Australia is undertaken by the private sector.
The industry’s activities
2.13
The National Waste Report 2018 provides a useful overview of the waste management and resource recovery industry in Australia. The flow of waste through this industry is depicted in Figure 2.1.
2.14
Briefly, the waste management and resource recovery industry engages in four main fields of activity:
Waste collection and transfer;
Re-use of waste and recycling; and
2.15
Municipal waste collection services are generally provided by local councils, either directly or through contractors, with the latter more common. To achieve economies of scale, some councils have formed regional groups to co-ordinate their waste management activities. In addition to collecting household waste, some councils collect waste for small businesses and institutions.
2.16
Many businesses and institutions contract directly with waste management companies to arrange collection of their waste. In the case of larger businesses and institutions, these contracts are often long-term and on a regional or national scale, but many smaller businesses and institutions rely on more ad hoc and short-term arrangements. This waste tends to make up the commercial and industrial and construction and demolition waste streams.
2.17
Waste sorting primarily occurs at facilities known as Materials Recovery Facilities (MRFs). These facilities sort waste, most commonly municipal solid waste that has been collected from recycling bins, into ‘marketable grades of materials’. Most MRFs are operated by private companies but some are owned by local councils.
2.18
Specialised facilities may be used to sort particular types of waste, such as organic waste. Sorting can be more problematic for the municipal solid waste stream than other streams as municipal solid waste is more diverse and less well sorted at the source (that is, prior to collection). It is therefore more at risk of contamination.
2.19
Waste re-use and recycling infrastructure is primarily owned and operated by private companies, with different infrastructure required for different types of materials. These companies range in the size and scope of their operations, from those handling a wide variety of materials to those specialising in a particular material.
2.20
Nearly all (99.9 per cent) of Australia’s core waste disposal occurs through landfill, with most of the remainder (particularly medical waste) being destroyed thermally. Landfills in urban areas are primarily operated by the private sector but in regional and remote areas they are largely run by local governments, either directly or through contractors. It is estimated that there are approximately 600 officially registered landfill sites in Australia, and as many as 2,000 unregulated sites, most of these being small.
2.21
There is opportunity to innovate at each stage of the waste management and resource recovery process, including before something becomes waste. As explained by the National Waste and Recycling Industry Council (NWRIC):
to reduce waste and pollution and make better use of our resources, innovation is required across the whole system. From what materials and resources we are using to produce goods and materials to how they are collected, reused and recirculated through the economy, or finally disposed of if a recovery solution is unavailable.
2.22
The waste management hierarchy and the circular economy are fundamental to identifying these opportunities.
The waste hierarchy
2.23
The waste hierarchy (also referred to as the waste management hierarchy) ranks waste management solutions from most preferable to least preferable. This model underpins waste management and resource recovery legislation in each state and territory. It is illustrated in Figure 2.2.
2.24
The waste hierarchy stipulates that the best option for dealing with waste is to avoid or reduce it, followed by re-using waste materials or products. It is important to note that neither avoid and reduce nor re-use directly involve the waste management and resource recovery industry. This is because neither option creates ‘waste’. In other words, both are designed to prevent the generation of waste in the first place.
2.25
The third alternative is recycling. Recycling is defined as the conversion of waste into raw materials to be used in the production of new products. Historically much of the metal, plastic, paper and cardboard collected in Australia for recycling has been exported to overseas recyclers for processing. This will significantly change with the introduction of Australia’s waste export bans in 2021.
2.26
The fourth level of the waste hierarchy is energy recovery or the conversion of waste into energy. In Australia, waste to energy is in its infancy compared to other countries. This process primarily occurs through the collection of methane produced by the anaerobic decay of organic waste from landfills, which is burnt to generate electricity for sale onto the grid.
2.27
The fifth preference is the treatment of waste. Treatment can refer to a number of different processes, including processes to recover recyclable material from waste, and processes to recover energy from waste (thermal treatment). Generally, treatment refers to the processing of waste prior to disposal so as to minimise the potential for harm to human health or the environment. Consequently, treatment is particularly important for hazardous waste, although it is often possible for such waste to be recycled after it has been properly treated instead of disposed.
2.28
The last and least preferred option in the waste hierarchy is disposal. Most commonly, disposal refers to landfill.
2.29
The Australian Industrial Ecology Network (AIEN) submitted that while the waste hierarchy is normally framed in terms of social or environmental good only, it can be applied as a representation of the notional commercial value of waste. It described this concept as ‘Highest Net Resource Value’. Under this model, a negative value is placed on resources at the lower end – that is, disposal to landfill. Conversely, ‘full commercial value’ is placed upon resources at the higher end – those that can be avoided or reused.
2.30
The AIEN suggested that adopting such a model would encourage greater focus on ‘recycled product markets’ and the ‘market/product end of the resource management system’ more generally, which have traditionally received ‘insufficient attention’ in Australia. This accorded with what the Committee heard from several other stakeholders about the need for more focus on end markets, an issue that is discussed more fully in Chapter 4.
2.31
Conversely, Mr Steve Robertson argues that the waste management hierarchy should not be a hierarchy at all. Rather, it should be constructed as a ‘selection of different waste management options that need to be considered on their merits and in the context of meeting a set of objectives’. Specifically, Mr Robertson stated:
There is great scope to improve upon our current methods to consider solutions to manage our current and future waste management challenges and the use of the hierarchy is one that needs to be nuanced and not used in isolation but with other tools and data to ensure that the solutions proposed provide the best on balance solution to the problem to be solved.
2.32
Furthermore, Mr Robertson stated that before a technique to manage waste is selected, it is necessary to understand the basis for selecting that technique, and these solutions should be considered in the context of broader environmental, social, public health or economic outcomes.
Circular economy
2.33
Perhaps the most fundamental concept relevant to waste management and resource recovery policy is the circular economy. The circular economy is not actually about waste. Rather, it is about design, and the consideration of materials and products as valuable resources.
2.34
The Ellen MacArthur Foundation defines a circular economy as follows:
A circular economy is based on the principles of designing out waste and pollution, keeping products and materials in use, and regenerating natural systems.
2.35
The circular economy contrasts with the more linear waste economy as illustrated by Figure 2.3.
2.36
A circular economy seeks to remove the ‘disposal’ stage entirely. For example, one submission stated:
Right now, our mostly linear economy means manufacturers expect their products to create waste and pollution. A circular economy means that all products are designed for end of life, where waste and pollution become design flaws to be eliminated.
2.37
Discussions of a circular economy often focus on the management and reduction of waste at the end of a product or resource’s lifecycle. It is important to recognize however that there are two critical points for waste management and resource recovery. The first is the front end, that is, the materials used to create products. The second is the back end, that is, what is done with these products after use or consumption.
2.38
The World’s Biggest Garage Sale (WBGS), a community based organization that seeks to commercialise the circular economy by ‘capturing and diverting goods before they become landfill’, framed this issue as a matter of forward and reverse logistics. This is depicted in Figure 2.4.
2.39
Under this model, forward logistics refers to the better design and manufacture of products to remove waste and extend a product’s lifecycle. Reverse logistics is concerned with the post-consumer stage where reuse, repair and repurposing of products are encouraged.
Shift to a circular economy
2.40
The Committee repeatedly heard that Australia must shift from its current linear economy that uses and disposes of goods to a circular one that seeks to keep products or components in use.
2.41
The Waste Management and Resource Recovery Association of Australia (WMRR) stressed the need for greater emphasis in Australia on the ‘front end’ management of resources. It argued there needs to be greater innovation in relation to the redesigning of products to encourage greater reuse, repair and recycling and a national emphasis on waste avoidance strategies for the community, retailers and product manufacturers.
2.42
RMIT made a similar point in its submission. It asserted that the ‘biggest innovation challenge facing the waste and recycling industries is the recognition of their inevitable transformation to being key drivers of a circular economy’. Furthermore, RMIT stated that the circular economy ‘can be seen as a design challenge as much as it is a materials handling challenge’ and emphasized the importance of product design for disassembly and ease of repair. Specifically RMIT argued:
As a starting point, products should be designed to reduce wastage at production, facilitate ease of repair and support ease of recycling (e.g easy dissembling and single-type materials). This is a first step towards supporting circularity and understanding a product’s lifecycle impact on the environment.
2.43
Design for reuse and repair was a constant theme throughout the inquiry. The Moreland City Council stated that innovation in the waste industry must come from manufacturers and importers who need to shift their focus from creating single use products to products which remain within the circular economy through repair and reuse before they end up in landfill.
2.44
This view was shared by Ms Karen Ellis, who with Mr Danny Ellis runs ‘Mend It, Australia’, a community group that organises repair events in Victoria. Ms Ellis stated that there is a strong need for manufacturers to design their products for repair rather than planned obsolescence. Furthermore, Ms Ellis stressed the need for funding for community reuse and repair events, stating there are over 2000 repair cafes around the world, showing there is a clear community interest in these events.
2.45
The importance of ‘design for repair’ was raised by Ms Erin Lewis-Fitzgerald, a clothes mending practitioner and author. Ms Lewis-Fitzgerald argued that although funding repair cafes and other community efforts are important, it was not a long term solution as this model relied too heavily on volunteers. Ms Lewis-Fitzgerald said that many products not designed for repair created issues for those attempting to resolve these problems. For example:
At Bright Sparks we often spent more time figuring out how to open up an appliance than we did diagnosing or repairing it. Two common barriers to repair success were broken plastic – we tried various industrial-strength glues but the repairs were never as strong as when new – and unopenable appliances. I remember a stick blender that took three of us to work out how to open, only to discover we couldn’t remove the parts we needed to repair.
2.46
Ms Lewis-Fitzgerald recommended that the Government legislate that all electrical products in Australia should be made of recyclable components and designed for repair, that they be easily able to be disassembled, and that spare parts be made readily available by the manufacturer.
2.47
The Australian Academy of Technology and Engineering (ATSE) emphasised the significant economic opportunities that can arise from better design and collection of raw materials:
we need to go back and think very carefully about how we regulate the product design in the first place so that it can be disassembled; then how we collect that material; and then how we get the logistics right to get it back to the manufacturers, where they can reprocess, make new products and sell those products throughout the world. It's a fantastic economic opportunity to increase exports, increase jobs and stimulate productivity throughout the nation.
2.48
The ATSE considers regulation to be the key issue in shifting the mindset of waste as a problem to waste as an opportunity.
2.49
The Committee notes the announcement that the Productivity Commission will look into the issue of right to repair in 2021, and looks forward to its report.
National policy
2.50
The National Waste Policy 2018 and the National Waste Policy Action Plan 2019 are based on the principles of a circular economy. Notwithstanding, submissions to the inquiry called for the development and implementation of a specific national circular policy – one that considers the lifecycle of a product and encourages the use of it and its materials for as long as possible.
2.51
The WMRR identified several benefits to transferring to a circular economy, including:
modernising Australia’s economy to enable sustainability;
encouraging and accelerating the decoupling of economic growth from the use of fossil fuels;
creating investment, local jobs and growing local economics; and
achieving national and international climate change goals.
2.52
The WMRR stated that Australia has seen some slow progress in moving towards a circular economic model, and still largely operates on a linear model. It attributes a lack of understanding of what a circular economy looks like and an absence of a shared vision for the country as contributing factors to this lack of progress. Furthermore, the WMRR states that, as a result, the Commonwealth Government has not been able to lead the transition away from a linear economy.
2.53
Several submissions drew comparisons with the progress made by European countries in transitioning to a circular economy. For example, the Southern Sydney Regional Organisation of Councils (SSROC) stated:
Australia is behind other countries, particularly in the European Union, which has established policies and made investments in infrastructure and technology to support circular economies to ensure secondary materials are used onshore, creating jobs and wealth.
2.54
Similarly, Ms Gayle Sloan, Chief Executive Officer, WMRR told the Committee that ‘other OECD countries have moved towards circular through sustainable design legislation, which makes it very clear about what you use and how use it’. In other words, other countries have emphasized design solutions. This includes the materials selected for products to ensure that the product or its components can be reused. If a product cannot be reused, the producer is responsible for the cost of managing the waste.
2.55
The WMRR further said that national consistency in policy, strategy and regulation was required to encourage a transition to a circular model, and considered that the National Waste Policy 2018 and Action Plan were missed opportunities in this regard.
2.56
The Lake Macquarie City Council supports a national circular policy and implementation framework. It stated:
European case studies demonstrate innovative recycling and end markets readily emerge within a circular economy with the right policy settings. The resource recovery industry’s current position as ‘end of pipe’ problem solvers is not viable, as evidenced by the current global recycling crisis. However, the recycling industry has the potential to be transformed into critical resource producers in the economic supply chain within a circular economy.
2.57
It further recommends that such a policy be supported by state and territory circular economy plans, and then by regional implementation plans. MRA Consulting Group, Dr Niina Kautto and the City of Adelaide also support the introduction of a national circular economy policy.
Innovation road map
2.58
The Commonwealth Scientific and Industrial Research Organisation (CSIRO) summarised five principles from the scientific literature about how innovation may assist governments and industry to address waste and recycling issues in a circular economy. It highlighted that:
An Australian circular economy would need to focus on creating value from and reducing waste for both the domestic and foreign markets.
Government investment in innovation for new circular economy friendly businesses offers not just economic benefits but may become an export opportunity. Businesses that create secondary materials from existing waste also require investment in order to deal with existing waste stockpiles.
Although there are many economic opportunities in the short term in shifting to a circular economy, in the medium and long term there are investment opportunities in the areas of waste minimization and resource efficiency.
Investing in innovation in the emerging ‘bioeconomy’ could replace Australia’s existing economic reliance on commodities. It is important that the digital economy underpins the movement towards a circular economy.
2.59
In May 2019, the CSIRO convened an international symposium, Waste Innovation for a Circular Economy to discuss the opportunities, barriers and strategy for transitioning Australia from a linear to a circular economy. In its submission, the CSIRO states that several opportunities identified at the symposium have the potential to yield significant economic, employment and environmental benefits. A summary report of the symposium is available on the CSIRO’s website.
2.60
The CSIRO is in the final stages of developing a set of circular economy, industry and technology road maps that cover each of the key banned export waste streams. It is expected that these road maps will help inform decision making by government and industry regarding waste management and recycling.
Committee comment
2.61
The Committee recognises the need to shift from a linear to circular economy. This is necessary to not only improve health, social and environmental outcomes related to waste management and resource recovery but to create important economic opportunities and growth of industries.
2.62
The Commonwealth Government’s National Waste Policy, Action Plan and Response Strategy are based on the principles of a circular economy. The Committee supports these initiatives, and in particular the specific actions set out to ‘encourage sustainable design’, ‘improve reuse and reparability’ and ‘support consumer choices’.
2.63
While acknowledging the important inroads made by the Commonwealth, the Committee sees value in placing more responsibility on the manufacturers, importers, and distributors of goods to strongly emphasise a shift towards a circular economy. This includes a greater focus on the design and composition of products, and consideration of regulation and incentives to encourage greater repair, reuse, recycling and recovery of materials.
2.64
The Committee recognises that much of the evidence it received relates to the management of municipal waste. However, waste statistics show that approximately 80 per cent of waste is from the commercial and industrial, and construction and demolition sectors. This requires closer examination.
2.65
The Committee recommends that the Commonwealth Government in consultation with state and territory governments implement a pathway to a predominantly national circular economy. This should pay attention to the design and composition of products to enable the greatest capacity for end of life recycling, and consider regulation and incentives to encourage greater repair, reuse, recycling and recovery of materials.
2.66
The Committee recommends that the Commonwealth Government undertake further research to identify and examine waste management and resource recovery opportunities related to commercial and industrial, and construction and demolition waste.