Waste less, recycle more: waste reform in Australia

Environment eBulletin - 26 March 2013

Summary

Waste management is a growing issue for Australia as we are now producing more waste than ever before. Between 2002 and 2006 waste generation increased by 31 per cent to 43.8 million tonnes. As a result, significant waste reform is taking place across Australia at a Commonwealth, State and local government level. 

The complexity of Commonwealth and state legislation and the escalating costs associated with sending waste to landfill means that increasingly, Australian businesses will need to ensure that they are effectively managing and minimising their waste.

 

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Waste management is a growing issue for Australia as the amount of waste being produced is greater than ever and growing. Between 2002 and 2006 waste generation increased by 31 per cent to 43.8 million tonnes. As a result, significant waste reform is taking place across Australia at a Commonwealth, State and local government level.

While, historically, waste disposal and handling have primarily been run by state and territory governments, waste reform is increasingly being tackled as a national issue. Increased Federal intervention has been motivated by the need for a more uniform and less complex waste management and levy system across Australia and ongoing compliance obligations with international conventions. Local government continues to play a vital role in waste management and collection.

This eBulletin provides a summary of the key features of the Commonwealth reform, as well as reforms taking place in NSW and Victoria which are likely to have implications for business in future.

 

Overview: management of waste at Federal level

Australia has ratified the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal, Stockholm Convention on Persistent Organic Pollutants and Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade through legislation such as the: 

  • Hazardous Waste (Regulation of Exports and Imports) Act 1989 
  • Product Stewardship Act 2000
  • National Environment Protection (Assessment of Site Contamination) Measure 1999

In recent times the Commonwealth has embarked on a series of reforms in relation to waste management. Below we have outlined some examples.

Hazardous Waste Act

The Hazardous Waste (Regulation of Exports and Imports) Act 1989 (Hazardous Waste Act) was introduced largely to meet the Basel Convention obligations and to regulate the export and import of hazardous waste. The Hazardous Waste Act is currently being reviewed. The review is likely to introduce more enforcement powers and penalties, as well as providing clarity regarding international conventions and agreements, such as free trade agreements. (Although, the review is likely to be put on hold in light of the Federal election later this year.)

SCEW

In addition, the Council of Australian Governments (COAG) Standing Council on Environment and Water (SCEW) implements National Environment Protection measures (NEPMs), among other things. The implementation of seamless environmental regulation and regulatory practice Australia-wide, including in relation to waste, is a priority issue for SCEW. The introduction of a national waste system has been flagged as a possibility by SCEW, as it would reduce the complexity of compliance with waste regulations for companies operating across state boundaries.

SCEW is also working to implement the National Waste Policy which was endorsed by COAG in 2009. The National Waste Policy provides a framework to support product stewardship and extended producer responsibility schemes, for example, the Australian Packaging Covenant (APC).

The APC is underpinned by the National Environment Protection Measure on Used Packaging Materials (Packaging NEPM). Signatories to the APC commit to work together to achieve targets and comply with the national environment protection guidelines. The APC is implemented differently by legislation in each state and territory. For example in NSW, the Protection of the Environment Operations (Waste) Regulation 2005 implements the APC.

While the APC is currently a voluntary scheme, it is likely that more mandatory schemes will be introduced if the waste targets identified in the APC are consistently not met by signatories.

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State waste reforms

The states and territories are primarily responsible for the regulation of chemicals and emissions and general waste management as part of meeting Commonwealth commitments.

In addition to Commonwealth reforms, states such as NSW and Victoria are also reforming waste management policies in order to reduce waste generated and encourage businesses to adopt more effective waste management practices. Below we give you an overview of recent reforms in both states.

New South Wales reform

In 2012, Environment Minister, the Hon. Robyn Parker commissioned KPMG to undertake an independent review of the New South Wales Waste and Environment Levy. The levy was established under the Protection of the Environment Operations Act 1997 (NSW) to support waste avoidance and resource recovery by creating a financial disincentive to sending waste to landfill and channelling the associated revenue to resource recovery infrastructure.

In recent years, the levy has been criticised for: 

  • generating illegal dumping; 
  • inappropriate allocation of revenue; and 
  • being too expensive which has contributed to waste being transported across state borders by producers of waste to avoid or reduce the payment of the levy.

Despite this, the waste levy has been successful in improving the rates of recycling in NSW. In 2010-11, NSW residents and businesses recycled 63 per cent of the total waste generated, compared to a 45 per cent recycling rate in 2002-03.

The KPMG review has resulted in the NSW Government releasing the Waste Less, Recycle More initiative, a five-year $465.7 million waste and recycling agenda for NSW. It aims to transform waste and recycling in NSW, modify the waste levy and bring in increased recycling, among other changes. $250 million has been committed over five years to fund: 

  • new large-scale waste and recycling infrastructure to support communities that pay the waste levy; 
  • recycling facility upgrades; 
  • drop-off centres; 
  • food and garden organics processing; and 
  • recycling innovation and support for businesses to increase recycling on site.

The Waste Less, Recycle More initiative also introduces a new local council program to commence in July 2013. This will involve a Waste and Sustainability Improvement Payment to be paid over five years to eligible councils to help support waste and recycling initiatives.

The operation of the waste levy will be improved through a structural adjustment program to assist NSW metal shredders and by reinstating a levy exemption of 10% for the disposal of virgin excavated natural material. These amendments will be included as part of the upcoming review of the NSW Waste Regulation.

Similar waste levies operate in every Australian jurisdiction.

Draft Energy from Waste Policy

Another recommendation from the KPMG waste levy review was the introduction of a waste to energy policy. The Draft Energy from Waste Policy was released on 13 March 2013 and provides options to convert waste to energy through the thermal treatment of waste to offset the use of non-renewable energy sources and avoid methane emissions from landfill. The Policy has been released for public consultation until 3 May 2013. Eligible waste fuels include biomass from agriculture, uncontaminated wood waste and recovered waste oil.

Where certain technical criteria specified in the Draft Policy are met, a facility which converts waste to energy will be licensed as "Energy Recovery" under Schedule 1 of the Protection of the Environment Operations Act 1997 and, therefore, the waste and environment levy will not apply to waste received at the facility. The Draft Policy is expected to replace the existing Guidance Note: Assessment of Non-Standard Fuels to bring New South Wales in line with current international best practice.

Victorian reform

Similar to NSW, the Victorian Government has proposed investment in "advanced technology" to convert waste into energy or fuel products in the draft Victorian Waste and Resource Recovery Policy, released October 2012. The draft Victorian Waste and Resource Recovery Policy, when finalised, will replace the Towards Zero Waste policy which expires in 2014.

The draft Victorian Waste and Resource Recovery Policy states that support for technology to convert waste into energy or fuel products will be contingent on proponents satisfying the Environment Protection Authority that the investment will deliver strong environmental, public health and economic outcomes for Victoria. This is a shift from the previous approach which preferred recycling or reuse over energy recovery from waste.

The draft Victorian Waste and Recovery Policy also identifies a number of other objectives set by the Victorian Government as part of its 30 year vision for waste management including: 

  • reducing the environmental and public health risks of waste; 
  • reducing illegal dumping and littering; and 
  • reviewing the regulatory framework and governance structure which currently oversees the state's waste and resource recovery management.

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Implications for business

  • In future, we may see an increasing amount of Federal intervention in tackling the issue of waste management and to ensure that Australia is meeting its international obligations.
  • The waste reforms taking place are likely to bring about important changes and opportunities for businesses. 
  • The waste levy, especially in NSW, will continue to discourage poor waste management practices - businesses should continue to invest in and explore recycling and waste reduction initiatives that reduce the waste sent to landfill. 
  • Incentives for businesses to minimise waste will continue and new technologies, such as waste to energy, will provide new options for dealing with eligible waste fuels. 
  • The reforms indicate that businesses producing large amounts of waste will be financially penalised and subject to increasing levies. Businesses should therefore look to reduce and manage their waste effectively in order to minimise regulatory risk.

Authors
Breellen Warry | Senior Associate
Natalie Rodwell | Lawyer

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Further information

All information on this site is of a general nature only and is not intended to be relied upon as, nor to be a substitute for, specific legal professional advice. No responsibility for the loss occasioned to any person acting on or refraining from action as a result of any material published can be accepted.