Councils face legal action over below-cost waste deals

LANDFILL OPERATORS, almost all of which are county councils, are facing legal action from the Environmental Protection Agency in relation to below-cost selling of landfill space.

Operators have until the end of next week to prove to the agency they are not accepting waste at a price below what is needed to run the facilities and fund their aftercare, remediation and clean-up.

Alternative waste firms have accused councils of being involved in a “closing down sale” of landfill space before the EU landfill directive takes effect in 2013.

The agency last year made non-compliance enforcement orders against 16 of the State’s 27 landfill operators for not charging waste collection companies “gate fees” for depositing waste which the agency determined were high enough for the operators to meet their statutory obligations.

Under waste legislation, landfill charges must be high enough to cover costs of acquisition or development such as loans, costs of operation and estimated costs of restoration, remediation and aftercare of the landfill for at least 30 years after its closure.

The agency last month wrote to all 27 operators warning it would take action if these conditions were not being met. In the letter, the agency states it was aware gate fees as low as €40 per tonne were being charged in some instances, down from €100 a tonne in 2008.

Besides there being insufficient funds for aftercare, the letter said the agency was concerned the low charges were having a negative effect on the development of biodegradable waste treatment.

It was not possible to give a general figure for what was below-cost selling, as landfills would have various financial needs depending on their size, whether or not they had loans and the level of aftercare needed, said Jim Moriarty, manager of the agency’s office of environmental enforcement.

“Our concern is that enough would be charged so that when a landfill reaches the end of its life there is enough money built up in the aftercare fund.

“There is anecdotal evidence that operators are charging €40 or even €30 per tonne; it’s hard to see how that would come close to being adequate,” he said.

It was hard to know the sums operators were charging their commercial customers, he said, as they were not obliged to publish gate fees and in their returns to the agency only had to report aggregated figures on waste received and total gate fees charged.

“It’s not like the price of a pint. It’s a free market, and operators are free to agree a price with their customers who, if they are delivering a high volume of waste, are likely to be able to negotiate a lower rate.”

He said the agency had the authority to decide whether operators were charging enough. It was not in the agency’s or the public interest to shut landfill sites if they were not charging enough as the problem of remediation funding would remain, Mr Moriarty said.

“If all the landfill facilities that are non-compliant closed we’d be in a bit of a pickle; apart from the aftercare issue, we still need landfill space. But after the returns come in, if we decide they’re not charging enough, we will seek orders in the courts requiring them to charge what we think is necessary for aftercare.”

Burning issue: €30m clean-up costs illustrate growing problem

THE PROBLEMS that can be caused by failing to set aside sufficient funds for landfill aftercare were recently illustrated by the fire at the Kerdiffstown landfill in Kildare which burnt for four weeks earlier this year.

The Environmental Protection Agency and the Department of Environment have already spent €3 million fighting the fire and the full clean-up of the site is expected to cost in excess of €30 million.

The operators, Nephin Trading, are in liquidation and, while the agency is trying to recoup the funds, a recent High Court decision could mean it will be unable to make the company directors liable for the clean-up costs.

David Tobin, sustainability manger with Lagan Cement which uses waste as an energy source for its cement kilns, said he believes cash-strapped local authorities have dropped landfill gate fees to achieve a quick sale for their remaining capacity.

"The landfill directive, which will further curtail the amount of material than can be placed in landfill from 2013, is giving rise to a closing down sale. Local authorities are also in need of cash and landfill space is being used as a source of revenue by some."

Significant investment has been made by waste companies in the areas of recycling and recovery in anticipation of the landfill directive and waste can be processed to produce a range of useful products such as recyclables, cement kiln fuels and compost, Mr Tobin said.

"Yet landfill prices have dropped to a level where it is questionable whether any commercial benefit accrues to operators running recovery plants."

Dublin City Council has since the start of this year had to buy landfill space in other counties outside the Dublin region because its facilities are full. This makes it even more apparent that the current low cost of landfill is artificial, Mr Tobin said.

"The inevitable result of this below-cost selling is that aftercare will have to be funded by the taxpayer."