Defra advises against regional view to landfill trading

Speaking in the first week of the Landfill Allowance Trading Scheme, Defra's new head of local authority waste performance Andy Doran said that some councils might be aiming to trade within regions, but that this might not mean the best value for money.

” Councils shouldn't be interacting only with those beside them “
– Andy Doran, Defra
Mr Doran said: “This is an England-wide marketplace – if authorities decide to trade within a region, they have to consider: is this Best Value?

“Councils shouldn't be interacting only with those beside them – Best Value might not be proven. Authorities need to look at the whole marketplace to decide what is best, and they may even need to appoint a broker,” he added.

Mr Doran warned that by trading within close-net circles, disposal authorities would also disrupt the rest of the national marketplace, potentially affecting Best Value for other authorities. “Trading regionally narrows the marketplace for everyone else,” he said.

Guidance

The Landfill Allowance Trading Scheme (LATS), which began on April 1, sees the 121 local authorities in England with disposal authorities set allowances for the amount of biodegradable waste they can landfill each year. If they do not have sufficient allowances to cover their landfill needs, they can buy additional allowances from authorities with allowances to spare.

This week Defra is putting additional guidance on its website to help local authorities adjust to the system, including how the LATS system applies to financing, accounting and liabilities of councils. Further guidance to be issued shortly will look at the issue of unforeseen circumstances such as population growth, and how these might affect potential fines for LATS non-compliance.

Defra has said councils can be fined up to 150 per tonne of material landfilled outside of allowance allocations, but Mr Doran repeated the government's line that it did not want to be forced to fine authorities for missing their LATS targets – under the system. He said the fines are the “fallback” for the Secretary of State to ensure the LATS system works.

” What we want to see is a risk-based approach taken by councils – contingency planning so that unforeseen circumstances are taken into account “
– Andy Doran, Defra
“What we want to see is a risk-based approach taken by councils – contingency planning so that unforeseen circumstances are taken into account,” he said.

Fixed

The LATS marketplace is fixed despite the prospect of population growth – particularly in regeneration areas and the South East – altering councils' waste demands up to the end of LATS in 2020.

Mr Doran said this was needed to allow confidence in the marketplace, but he acknowledged the difficulties that could arise because of population growth and the fact that revenue support grants are only provided when populations are already in place – not where new populations are expected. He said guidance would be made available, and that circumstances could be assessed on a case by case basis for councils on the ODPM regeneration list.

More guidance on areas like contracting is also expected soon, as is the Environment Agency's ruling on the contribution of mechanical biological treatment to LATS following the Agency's the consultation.

Some uncertainties involved in the LATS system – such as exactly which wastes count as municipal waste and fall under the remit of landfill allowances – are matters for councils to take their own legal counsel, Mr Doran said.

But Mr Doran added: “Defra is, however, committed to providing further clarity on the definition of municipal waste and how each waste disposal authority can go about deterring the scope of wastes within their landfill allowances and will be reporting this as soon as is practicable.”