Sustainable, reliable, affordable: NSW Government’s new plans for waste

Introduction

The NSW Government has released two issues papers for tackling the NSW waste crisis. These are:

1. Cleaning Up Our Act: The Future for Waste and Resource Recovery in NSW, Issues Paper (Waste Paper)
2. Cleaning Up Our Act: Redirecting the Future of Plastic in NSW, Discussion Paper (Plastics Paper)

The scope and extent of policy and regulatory changes which may flow from these plans have the potential for significant and long-term impacts for many businesses. At a time when the waste industry is under continued pressure from external shocks and emerging waste streams, disruption from new technology, and increased scrutiny at a national level, it is crucial that business and all stakeholders engage with these issues papers to provide feedback to the NSW Department of Planning, Industry and Environment (Department) by the deadline of 5pm Friday 8 May 2020.

20-Year Waste Strategy

What is it?

The intention to develop a whole-of-government 20-Year Waste Strategy was initially flagged by the NSW Government in late 2018.¹ The Waste Paper builds on consultation undertaken during 2019 with key stakeholders² and its dialogue with the Federal Government and other states and territories on the development of the National Waste Policy. The NSW Government is now seeking wider public consultation through the release of the Waste Paper.

The 20-Year Waste Strategy is intended to provide a long-term strategic focus for reducing waste, building infrastructure capacity and driving sustainable recycling markets in NSW, compared with the often-criticised 5-year strategies³ which have been implemented since 2003. It will replace the existing NSW Waste Avoidance and Resource Recovery Strategy 2014-2021 (2014-2021 Strategy).

The need to increase resilience to external shocks is emphasised in the Waste Paper. This follows the Council of Australian Government’s agreement in August 2019 to phase out exports of glass, tyres, paper, cardboard and plastic from Australia, partially in response to China’s “National Sword Policy” which restricted the types of materials China would accept.

The Waste Paper identifies that NSW is not on track to meet its established targets under the 2014-2021 Strategy of diverting 75% of waste from landfills by 2021. It also notes that NSW does not have the capacity to recycle the 240,000 tonnes of waste which was previously exported annually, and that landfills are expected to reach capacity in the next 10-15 years. The timeframe of 20-years is necessary to implement a long-term strategy and provide confidence to industry, investors and financiers, and certainty to communities, for the significant infrastructure needed for meeting the industry-wide challenges. Importantly, it focuses on both metropolitan and regional areas, recognising the importance of better environmental and economic outcomes (including jobs growth) across the whole sector.

Incorporating the circular economy

The 20-Year Waste Strategy will be underpinned by the NSW Government’s stated commitment to realise a circular economy.⁴ The circular economy principles encourage maximising the values of all materials used in the creation of products and the delivery of services to conserve natural resources and avoid the production of any wastes which must be disposed in landfills. Innovation is critical to the creation of new markets for materials and new resource-efficient technologies and systems. Examples of emerging technologies include the microfactories for converting discarded plastics into 3D printing filaments, or contaminated and mixed plastic into furniture products and steel-making products.⁵

The Waste Paper is guided by four “directions” mandated by a circular economy:

Each direction or stage contains several options, with each option reflecting a proposed strategy and being accompanied by a series of questions guiding the feedback sought from the Department.

Some of the key options are discussed below. As will be seen, none of the issues identified can be resolved (or even adequately addressed) in isolation from the others. The overhaul of the State’s waste and resource recovery policy and regulation needs to be coordinated and all-encompassing if it is to achieve the transformative change necessary to respond to domestic and international challenges for (at least) the next 20 years.

Review of the waste levy and the resource recovery framework

The Waste Paper reveals the potential for a widespread review of the existing waste regulatory and legislative framework in NSW. It specifically requests feedback on “the key opportunities for improving current waste regulations and regulatory processes in NSW.”

The two most significant regulatory obstacles for businesses operating in the waste sector are addressed: the waste levy and the resource recovery and exemption framework.

Regarding the waste levy, the Department emphasises the need to review the current arrangements in order to reflect population growth, circular economy objectives and new waste materials and processing capabilities. In particular, option 2.8 of the Waste Paper suggests a review of the waste levy which could cover:

• waste levy boundaries;
• further exemptions from the waste levy for “problem wastes”;
• national harmonisation of waste levies;
• various price-based instruments to encourage waste reduction; and
• mechanisms to maximise the value of materials put into the waste stream, such as increased penalties for littering.⁶

Feedback is sought on the “right settings for these waste levy parameters” as well as on any other price-based incentives which ought to be considered. Responses to this topic should take into consideration the effectiveness of current and historical regimes, such as the proximity principle, the impact of more recent changes to waste levies in neighbouring states and the flexibility (or otherwise) in the current regime for nimble responses to external shocks.

Similarly, with the objective of making it easier to do business, the Waste Paper stresses the need for clear, consistent and robust environmental and planning rules to support waste and resource recovery infrastructure investment. Included in the list of “Areas that could be explored” is:

“Making regulatory decision-making and compliance expectations clearer and simpler, particularly for complex regulatory matters such as the Energy from Waste policy, and the EPA’s Resource Recovery orders and Exemptions framework”⁷

Responses to this issue should consider the interaction with concurrent strategic planning reforms, such as the rollout of the NSW special activation precincts, the Greater Sydney Commission Place-based Infrastructure Compacts and the NSW Future Transport 2056 Strategy.⁸

Energy from waste

The Waste Paper notes that energy from waste technology will be an essential option for materials that have limited further market value or cannot be recycled. The 20-Year Waste Strategy is identified as an opportunity to consider new mechanisms for approving emerging or innovative energy from waste technologies and to review the 2015 NSW Energy from Waste Policy Statement.⁹

The recognition of the role of energy from waste goes hand in hand with the acknowledgement of the continued necessity of landfills within the waste management hierarchy. The Waste Paper highlights the long timeframe for the planning, approval and construction of these (and other) waste facilities and the very limited strategic planning that has occurred to date to embed waste management as an essential service in city and regional planning.¹⁰

Question 4.4 of the Waste Paper seeks feedback on the policy and regulatory improvements that could facilitate innovation and market development in the energy from waste sector, without compromising best practice environmental standards. Responses to this question should take into account the discussion regarding improved collection and increased joint procurements amongst Councils to provide the required waste volumes for new or enhanced waste infrastructure.¹¹

Waste benchmarks

The Waste Paper suggests that the NABERS (National Australian Built Environment Rating System) ratings could be leveraged to foster better source separation and waste processing outcomes. The NSW Government may seek to introduce minimum NABERS Waste requirements for buildings owned and rented by the government. However, the Department is also seeking feedback on the scope for a wider rollout to the private sector, with question 2.4 asking “Are there opportunities to roll out similar requirements to other sectors?”¹²

Responses to this question will also need to consider the complementary measures that may need to be taken, such as improving waste collection and reducing contamination, increased collective procurements amongst government agencies, options for simplifying and harmonising sorting requirements across Councils and the increased use of smart technologies, data and analytics.

Net-zero emissions from organic waste by 2030

Approximately 70 per cent of Australia’s waste emissions come from the decomposition of organic matter in landfills.¹³ The Waste Paper confirms that the NSW Government will set a target of net-zero emissions from organic waste by 2030. This is in line with the NSW Government’s commitment to reach net zero emissions by 2050.¹⁴ This ‘Net Zero Plan’ indicates that the NSW Government will “establish world-leading landfill diversion policies to apply to the waste industry” and facilitate the development of 'waste to energy' facilities in locations that have strong community support, provided those facilities meet strict environmental standards.¹⁵

Landfill and other waste activities comprise approximately 13 per cent of contracted abatement under the Emissions Reduction Fund. As of January 2020, there are 30 registered projects which divert waste from landfill using the source separated organic waste and alternative waste treatment methods.

The Waste Paper seeks feedback regarding the key opportunities and challenges with the reduction of emissions from food and garden waste, seeking first to reduce the waste (particularly for food) and then identifying options for better source separation, and reuse (such as garden organics to biogas).¹⁶

Responses to this issue should take into consideration the recent recommendation of the Climate Change Authority that the Federal Government work with states and territories to reduce landfill emissions by strengthening and harmonising regulations on methane emissions from landfill waste, diverting organic waste from landfill and fully implementing the National Food Waste Strategy.¹⁷

Redirecting the Future of Plastic

The Plastics Paper proposes the development of a whole-of-lifecycle ‘Plastics Plan’ for plastics, governing its production through to its disposal. In acknowledgment of the global plastic pollution crisis, the Plastics Plan will from part of the 20-Year Waste Strategy and will be the first comprehensive approach to managing plastic waste and pollution in NSW.¹⁸  It is intended to work in tandem with the NSW Circular Economy Policy Statement as well as the National Waste Strategy and the proposed waste bans.

The stated objective of the Plastics Plan will be to protect environmental and human health, minimise impact on consumers but importantly to also to maximise economic opportunities.

The Plastics Paper sets out four key outcomes relating to each stage of the lifecycle of plastic:

1. reduce plastic waste generation;
2. make the most of our plastic resources;
3. reduce plastic waste leakage; and
4. improve our understanding of the future of plastics.

Each outcome is to be supported by a proposed target and priority directions.

The Plastics Paper identifies a wide range of potential regulatory changes which have the potential to dramatically impact the way many businesses, agencies and the community operate in NSW. In providing responses to the Plastics Plan generally, we recommend that business and stakeholders consider the interaction with the National Environment Protection (Used Packaging) Measure 2011, the Australian Packaging Covenant and the recent APCO Our Packaging Future strategy paper for the delivery of the 2025 national packaging targets.

Mandatory product standards

One of the suggested changes in the Plastics Paper is to mandate product standards for plastic items, including packaging. Such standards could relate to the type of polymers used as well as the way that items are assembled. While many businesses have currently signed up to the Australian Packaging Covenant Organisation (APCO) industry target of 100% recyclable packaging by 2025, this is not currently a mandated requirement in NSW.

Feedback is sought on the introduction of any such standards including the materials and products which should be covered and what standards would reduce plastic waste generation.¹⁹

Noting that 99% of plastics are made from fossil fuels and the global production and incineration of plastic releases 400 million tonnes of CO2 a year,²⁰ responses to this issue could consider the interaction of the Plastics Plan with the NSW Net Zero Plan and the Federal Government’s commitments under the Paris Agreement, as well as options for participation in government carbon abatement and sustainable finance to assist with the transition to mandatory product standards.

Phasing out key single-use plastic items

As has been widely reported by the media, the Plastics Paper states that the NSW Government intends to phase out lightweight plastic bags within six months of the passage of legislation.

Other single-use plastic products which are being considered for a potential phase out are:

• disposable plastic plates/bowls, cutlery, cups, stirrers and some other single-use food service items;
• expanded polystyrene food and beverage containers;
• plastic straws;
• heavier/boutique plastic bags; and
• oxo-degradable plastics.

Feedback is being sought on the level of support for the phasing out of these additional products, potential timeframes and implementation challenges. Suggestions are also being sought for additional products to be included in this list.²¹

Responses to this issue should consider the viability of the proposed timetable for the phase outs and the economic opportunities for the production of sustainable and economically viable alternatives. In this regard, the Plastics Paper notes that plastic manufacturing employs approximately 85,000 people nationally and designing out plastic needs to be implemented as an economic opportunity for manufacturing and employment growth.²²

Producer responsibility and product stewardship

The Plastics Paper raises the possibility of producer responsibility and product stewardship schemes for plastic items in NSW. Existing voluntary industry-led extended producer responsibility or product stewardship initiatives are recognised, but the Plastics Paper suggests that establishing mandatory targets and/or providing additional governance and oversight may be required.

Extended producer responsibility schemes could apply to specific plastic products. For example, feedback is sought on potential schemes for the collection and management of cigarette butts and fishing gear.²³ Responses to this issue should also consider the interrelationship with the Federal regime under the Product Stewardship Act 2011 and the proposed COAG-led waste bans, as well as the impact financial instruments and economic incentives (for example, a form of waste levy and exemptions) may have on achieving the Plastics Plan objectives.

Mandatory 30% recycled content by 2025

The Plastics Paper indicates the NSW Government may consider mandating plastic packaging to contain at least 30% recycled content by 2025. The rationale is that this would not only reduce plastic waste, but would help drive demand for recycled plastics, support the recycling industry and create new economic opportunities to tap into an underutilised resource stream.

The proposed 30% target is consistent with the existing voluntary industry-led target currently established by the APCO.²⁴

Responses to this issue should consider the resources, finance and time required to establish the technologies and facilities to achieve the required recycling, as well as the role agencies and councils may play in achieving this objective through procurement policies.

Next steps

Later this year, the NSW Government proposes to release a draft 20-Year Waste Strategy with proposed actions for implementation for public consultation. The NSW Plastics Plan is intended to form part of the finalised 20-Year Waste Strategy which is currently scheduled to be completed by early 2021.²⁵

This article has only covered a few of the key issues raised by the papers. We encourage you to review the Waste Paper and the Plastics Paper in full. If you would like to discuss any part of the papers in more detail, or would like assistance in preparing a submission, please contact a member of our team.