New waste levies could hit incinerator viability

 

WASTE DISPOSAL levies of up to €120 per tonne, four times the current landfill levy, have been proposed by Minister for the Environment John Gormley.

The proposal for a new maximum levy on waste going to landfill sites or incinerators comes just two months after Mr Gormley increased the landfill levy from €25 to €30 per tonne.

If implemented, the levy could threaten the viability of the 600,000-tonne capacity incinerator currently under construction on Dublin’s Poolbeg peninsula.

The levy, which is part of the draft Environment Bill released for public consultation yesterday, is almost 12 times higher than the incineration levy recommended by the Economic and Social Research Institute (ESRI) in their recent analysis of waste management policy commissioned by Dublin City Council.

The ESRI report, which was critical of Mr Gormley’s policies on incineration, initially proposed incineration levies of €4.22 to €5.07 per tonne of waste. The organisation later admitted it had made an error in its calculations and revised them upwards to €9.80-€10.70 per tonne.

The ESRI recommendations were dismissed by Mr Gormley. However, the level proposed in the Bill is still several times larger than the €26 incineration levy recommended by the International Review of Waste Management Policy which Mr Gormley commissioned from environmental consultants Eunomia.

The Bill does state that the levy can be increased just once in any financial year, and that it must not be increased by more than €50 above current levy rates. This would mean that levies for waste going to landfill sites could not go above €80 in the first year after the introduction of the Bill.

However, no levy for incineration currently exists, as no municipal waste incinerator has yet to begin operating. This means that any incinerator operators could be forced to charge a levy at the maximum level of €120 as soon as a facility opens.

While the Bill sets a maximum charge, subsequent waste management regulations would set the actual rate of levy for waste disposal. A spokesman for the Department of the Environment said it was unlikely that any regulations would set the levy at the maximum allowed under the Bill, but he said the regulations could set different levels of charge per tonne for different sizes of incinerator.

The draft Bill also contains a provision stating that the Minister can amend the amount of the levy for the purposes of preventing the generation of waste and to reduce the quantity of waste disposed of by means such as incineration.

Mr Gormley has consistently maintained his opposition to large municipal incinerators, particularly of the scale being constructed by Dublin City Council and its private partners Covanta/Dong at Poolbeg, and signalled several months ago that the levies he intended to introduce would make the facility unviable.

Referring to the draft Bill yesterday, Mr Gormley said he envisaged a banded series of levies “based on capacity” of a facility.

“In order to have the dissuasive effect required, those who process more will pay more,” he said.