Councils see decline in tenders for WEEE

Devon county council is one of a number of authorities who have reported that bidding numbers for the collection work are down. The authority had to re-tender its contract for the clearance of WEEE from civic amenity sites on two separate occasions this summer, after having received no suitable bids to complete the work.

However, another local authority, Leicestershire, which has also completed a tender process for the collection of WEEE has claimed that there is still demand from producer compliance schemes albeit at a reduced level than before 2014.

A spokesman for the council added that increased haulage costs may be having an effect on where compliance schemes look to compete for material.

System

Law changes came into effect in January 2014, altering the way that the producer compliance system for WEEE operates. These changes were designed to reduce the overall cost of the regulations on producers, as it was claimed that the laws ‘did not reflect the true cost of recycling’.

Changes to the law have effectively removed the market for the trading of WEEE ‘evidence’ between compliance schemes, which it had been claimed had led to inflated costs under the pre-2014 system.

‘Evidence notes’ are used to demonstrate that producers have funded the recycling of a volume of WEEE in proportion to the amount of new products they have placed onto the market in the UK.

Since the changes to the law were brought in at the start of 2014, under collecting schemes are no longer forced to secure evidence from over-collectors, and can instead opt to use a ‘compliance fee’ to meet the targets.

According to experts within the sector, this has shifted the balance of power away from over-collecting schemes, who would have been guaranteed a market for the evidence that they had generated under the old system.

This is important for local authorities, who could benefit from a demand for WEEE from civic amenity sites with compliance schemes competitively tendering to win contracts with for the clearance of WEEE. Often these would include incentives for councils, including communications initiatives or revenue sharing arrangements, paid for by the compliance scheme.

The regulations do not place any requirement on local authorities to carry out collections of WEEE, many councils register their household waste recycling centres (HWRCs) as Designated Collection Facilities (DCFs) to guarantee that the WEEE will be cleared by a compliance scheme.

However, with some compliance schemes now reassessing their overall need for WEEE evidence in light of the changes in the market, there is a potential knock-on impact on the number of schemes seeking to bid for WEEE available from councils. This is particularly likely to be the case for authorities in remote areas where the logistical costs will be higher.

According to Devon county council there has been a notable difference in demand for WEEE since 2011, when it last tendered its contract for the collection of WEEE, and the previous tender in 2007.

A spokesman for the local authority, said: “Market interest in the tenders and competition for these contracts from Producer Compliance Schemes was very strong and Devon county council benefited from significant ‘added value’ contractual benefits.

“During the summer of 2015, DCC tendered a new contract for WEEE collections from its network of HWRCs. The first tender resulted in no compliant bids. This was then re-run and resulted again in no compliant bids. This lead DCC to negotiate directly with a PCS and we are now in the process of signing a mutually agreed contract with them.

“The market for WEEE collections from DCFs under the new WEEE Regulations is very different than that under the original WEEE Regulations and market interest has significantly declined.”

Leicestershire

Leicestershire council has also noted a drop in bidders for its WEEE tender, completed in summer 2015, although the authority has claimed that much of the change in demand may be due to fewer compliance schemes in the market.

A Leicestershire county council spokesperson said: “In Leicestershire we did see a reduction in the number of organisations tendering for the WEEE contact compared to previous years, however, we suspect this is due to less producer compliance schemes in the market.

“Although the introduction of the producer compliance fee may be one factor, we believe there are significant other factors, including increased haulage costs and continued local government austerity.

“As with other local authorities, we have seen a reduction in the revenue generated from small and large domestic appliances, along with scrap metal payments being stopped, which could also contribute to the change.”