AD guide prices to be published from this month

Up until now, prices listed on the website included those for green waste treatment and food waste treatment (in per tonne), alongside the price paid for a cubic metre of waste derived compost.

However, the rise in the number of AD facilities has driven the price for treating food waste through AD in some parts of the country down, meaning that the difference between the prices paid at AD and IVC plants has become more marked. There are also wide regional variations and variations depending on feedstock.

According to the governments Official Information Portal on anaerobic digestion, the number of waste-fed anaerobic digestion facilities has risen from just two in 2005 to 48 at present, which organics recyclers say has increased competition in the market, putting downward pressure on gate fees.

AD plants also qualify for income from renewable energy generation and ROCs and FiTs subsidies, meaning that they can charge less at the front end.

The fall in gate fees at AD facilities was first highlighted by operators in June 2012 (see letsrecycle.com story). It is understood that, in some parts of the country, some companies have been charging at little as zero gate fees for food wastes with a high calorific value. However, industry sources have said this is not typical nor sustainable.

Typically, gate fees for AD currently stand at between 25-45 a tonne, while prices charged at in-vessel composting facilities range from 30-55 a tonne. Whether material is packaged or not also has a bearing on price.

Volatile

Mike Orr, chair of the Organics Recycling Association (AfOR) and an executive director with organics recycling company TEG, said that the gate fee for organic waste had always been relatively volatile with wide variations according to regions, type and the proximity of treatment facilities.

But, he explained that the increasing number of plants was growing prices for food waste treatment in AD plants down.

Mr Orr added: With AD facilities coming on line the gate fee for food only derived feedstock has been steadily driven downward as AD plants compete for feedstock, as the AD process is totally reliant on continuous consistent feedstock this has further increased the pressure on price. How much further this price reduction can go remains to be seen, but the current price for power off take, ROCS and FITS , and the almost non-existent demand for heat would indicate that we are at the very lowest end of the business case for AD.

Almost all Local Authorities have decided on their collection method now which ultimately is the main factor deciding the ultimate treatment method.

In contrast, Mr Orr said the market for in-vessel composting was more established, meaning that gate fees were more stable.

He commented: The price of co mingled waste which goes into IVC is more stable , with a more mature market and established processors. However the continuing pressure from the EA on the composting sector could see a large number of processors giving up the battle, and a reduction in the number of operating site swill of course have an impact on price.