WRAP’s ninth annual gate fees survey covers gate fees charged to local authorities in the UK for a range of municipal waste recycling, recovery, treatment and disposal options.
- The median MRF gate fee is £25/tonne compared to £6/tonne last year
- Commodity prices and other factors have impacted on MRF gate fees
- MRF gate fees are expected to increase further.
The aim of this report is to increase price transparency and, by improving the flow of information, improve efficiency in the waste management market.
Summary information on gate fees 2015/16:
Data gathering for this gate fees survey was conducted between December 2015 and January 2016. The survey targeted three main stakeholder groups: local authorities (including unitary, waste collection and waste disposal authorities); private sector operators of waste management facilities; and senior managers of large waste management companies operating within the UK market.
WRAP has also produced an infographic that summarises the main findings.
Summary of key findings
The median MRF gate fee for contracts sorting 4 or more materials is £25/tonne (based on 109 usable gate fees), compared to £6/tonne last year. This year, 28% of local authority respondents reported not paying a gate fee for MRF services i.e. a zero or negative gate fee, in comparison to 46% last year. For contracts signed in 2015, the median gate fee is £38/tonne, compared to £5/tonne for contracts signed in 2014. Of the authorities supplying responses, 55% reported a change in gate fee in 2015/16, made up of 5% reporting a decrease and 40% an increase in gate fee (10% did not report direction of change). Of those reporting a change, 5% gave the reason for the change as the signing of new contracts, 46% changes in commodity prices (reflected through variable gate fee arrangements or changes to such arrangements), 12% the impact of the MRF code of practice and contamination issues, 25% contracted indexation (RPI increases), with 12% giving no explanation.
Feedback from waste management companies suggested that the overall MRF survey medians were at the low end of gate fees now being charged to local authorities, reflecting the number of historical contracts in the data. They confirmed the need for increased risk share due to falling commodity prices and increasing contamination issues, and expect MRF gate fees to increase further.
The median OAW composting gate fee for green waste only, is unchanged from the previous year’s survey at £24/tonne. Small increases in individual local authority gate fees were explained by RPI increases. The operator survey confirmed that OAW is a stable, mature market11 and operators report similar current contract gate fees to local authorities at £25/tonne, and spot market figures of £30/tonne.
The median gate fee for IVC of mixed food and green waste is slightly higher than last year at £47/tonne (£46 in 2014/15), although 65% (38 of 59) of those responding cited no change in gate fees paid from last year. However, the range in gate fees has narrowed, from £24 - £75 last year, to £22 - £61 this year. The operators cite a median contract gate fee of £45/tonne for this input material.
The median gate fee for food waste only is also unchanged at £45/tonne. However the lower range of gate fees cited for food waste has fallen by £8/tonne, with waste management company interviews suggesting this could be due to increasing competition from AD facilities in some regions. The operators survey median was £48/tonne and so slightly higher.