WRAP Gate Fees Report 2012

9th July 2012

Today WRAP publishes its Gate Fees Report 2012. This annual report provides an updated summary of charges for a range of alternative waste treatment, recovery and disposal options across the UK. The Gate Fees Report compares current charges with those in previous years, and summarises industry’s opinion on possible factors that may influence future gate fees.

Steve Creed, Director of Market Economics WRAP, said: “This year’s Gate Fees Report highlights the growing number of cost-effective alternative waste management opinions to landfill, underlining the economic and environmental savings we can make if we do not bury our waste in the ground.”

“MRF gate fees have continued to fall and are substantially lower than reported in our previous surveys. Many local authorities say that they are either not paying gate fees, or are receiving payment for their recovered materials.”

Other key findings identified by report include:
• The median MRF gate fee is £9 per tonne, down from £15 per tonne in last year’s report.
• The median gate fee for OAW (Open-Air Windrow composting) is little changed from last year. OAW gate fees have been more-or-less constant for several years.
• IVC (in-vessel composting) gate fees vary substantially with a key factor being the composition of the material received by facilities. Food waste mixed with garden waste and card attracts higher gate fees (median gate fee of £55 per tonne), followed by food waste only (median gate fee of £49 per tonne) and mixed food & garden waste (median gate fee £44 per tonne). These are in line with last year’s report. However, the report highlights a substantial drop in IVC gate fees for garden waste, which are down by around £10 to £25 per tonne. IVC operators reported that gate fees were being driven primarily by increased competition from other IVC facilities, as well as from other competing treatment technologies, most notably AD.
• For anaerobic digestion (AD) the median gate fee is £41 per tonne (with a range from £35 to £60 per tonne). This compares with a median figure of £43 per tonne in 2011 (range £36 to £64 per tonne). The median AD gate fee is now lower than the median gate fees for food waste only and for mixed food & garden waste at an IVC facility. However, because the AD industry is still developing these findings are based on a relatively small sample and therefore need to be interpreted with caution. Operators of AD facilities cited direct competition for feed stocks, energy prices, and broader economic pressures as factors likely to influence future AD gate fees. 
• The median gate fee for the onward management of wood waste collected from Household Waste Recycling Centres is £26 per tonne. Variation in wood waste gate fees across the UK reflects regional differences in supply and demand. In the South East of England supply has long exceeded demand so gate fees are higher, while in the North East of England and Scotland demand typically exceeds supply and gate fees are lower. Biomass facilities are understood to be paying for their input materials, rather than charging a gate fee.
• The median gate fee for EfW (energy from waste - incineration with energy recovery) facilities is £65 per tonne (with a range from £32 to £101 per tonne).  As shown by previous gate fees reports, ‘older’ facilities (pre-2000) tend to have lower gate fees (median gate fee of £64 per tonne) than ‘newer’ (post-2000) facilities (median gate fee of £82 per tonne). EfW gate fees are comparable to landfill gate fees inclusive of the standard rate of landfill tax.
• Mechanical biological treatment (MBT) the wide range of facility types and treatment processes which are labelled as MBT suggests that the median gate fee should be interpreted cautiously. That said, the median MBT gate fee in this report is £79 per tonne. This takes into account costs associated with the disposal of process residues, including low quality residues which may have to be landfilled, fuel/SRF and revenues from the sale of recovered materials.
• The median landfill gate fee for non-hazardous material (inclusive of the standard rate of landfill tax) is £85 per tonne.  As in previous reports, landfill site operators again noted the competitive marketplace for landfill, with reduced quantities of residual waste and increased competition from other treatments leading some operators to reduce their charges to maintain volumes.  However, against this trend, some landfill operators have increased their gate fees (excluding tax) in line with inflation and others have not changed their gate fees.

1. To read the Gate Fees Report 2012
2. The Gate Fees Report surveys local authorities and facilities in England, Wales, Scotland and Northern Ireland. It was conducted between November 2011 and February 2012 and covers both those procuring waste treatment, disposal and recovery services (primarily local authorities) and service providers.
3. Gate fees for similar waste management options can vary substantially, both across and within regions.  Indeed, the factors which determine specific gate fees at a facility are complex, ranging from the size of a facility, the nature and duration of contracts (including risk-sharing arrangements), financing arrangements, the age of the facility, the level of revenues generated from the sale of recovered materials and other outputs (such as energy, compost, digestate etc.) and prices paid for the management of residues.
4. WRAP’s Gate Fee report aims to disseminate information on gate fees thereby increasing price transparency and enhance the efficiency with which the waste management market operates. The information provides local authorities with important market information to help them make informed decisions regarding waste treatment and disposal.
5. WRAP’s vision is a world without waste, where resources are used sustainably. We work with businesses and individuals to help them reap the benefits of reducing waste, develop sustainable products and use resources in an efficient way.
6. Established as a not-for-profit company in 2000, WRAP is backed by government funding from England, Scotland, Wales and Northern Ireland.
7. More information on all of WRAP's programmes can be found on www.wrap.org.uk


Ian Palmer

PR Officer, WRAP
01295 819 677