ETS Impact on The Future of
Small Landfills
Chris Lobb
6 October 2011
ANNUAL CONFERENCE 2011
Scope of Presentation
• Introduction
• ETS impact on landfills up to 50,000 tonnes per
annum
• Key issues to consider
• Work through four landfill examples
• Summary
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Waste Disposal Facilities
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Introduction
• ETS introduced for waste in January 2013
• Landfills report CH4 emissions from Jan 2012
• All landfills to surrender New Zealand Units (NZUs) to
match their emissions from 1 January 2013
• Review Panel recommendations for very small landfills
exemption to be approved
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ETS Disposal Facility Definition
The ETS defines [1] :
“disposal facility means any facility, including a landfill,—
“(a) at which waste is disposed; and
“(b) at which the waste disposed includes waste from a
household that is not entirely from construction, renovation,
or demolition of a house; and
“(c) that operates, at least in part, as a business to dispose of
waste; but
“(d) does not include a facility, or any part of a facility, at which
waste is combusted for the purpose of generating electricity
or industrial heat
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ETS Disposal Facility Definition
The ETS defines [1]
All municipal waste landfills are included in
the ETS.
However, industrial waste landfills, cleanfills,
or any facilities that accept no household
waste are excluded.
[1] Climate Change Response (Emissions Trading) Amendment Act 2008
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Calculation of Emissions
• Landfill operators can use either
– Default Emissions Factor (DEF) of 1.10 tonnes of
CO2 equivalent per tonne of waste
– or a landfill specific Unique Emissions Factor
(UEF).
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Unique Emissions Factor
• The UEF for a landfill with no Landfill Gas collection or
destruction system is calculated using the fraction of each of
the following classes of waste disposed:
–
–
–
–
–
–
–
garden waste;
nappy and sanitary waste;
putrescibles other than garden waste;
paper waste;
sewage sludge;
timber waste;
textile waste.
• determined by two SWAP surveys in the base year
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Unique Emissions Factor
For landfills with Landfill Gas (LFG) collection
and destruction (by flaring or energy
production)
– the UEF is calculated based on the collection &
destruction efficiency of the LFG system and can
include the waste composition calculation.
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ETS Financial Impact
Annual ETS Obligations per Tonne of Waste Disposed (assuming DEF)
ETS Obligation/t
ETS Obligation/t
ETS Obligation/t
Price of
No LFG System
50% LFG
80% LFG
Carbon/t
Destruction
Destruction
$15.00
$16.50
$8.25
$3.30
$20.00
$22.00
$11.00
$4.40
$25.00
$27.50
$13.75
$5.50
Annual ETS Obligations for Landfills with No LFG System
Price of
5,000 t/year
10,000
20,000
30,000
Carbon/t
t/year
t/year
t/year
$15.00
$82,500
$165,000
$330,000
$495,000
$20.00
$110,000
$220,000
$440,000
$660,000
$25.00
$137,500
$275,000
$550,000
$825,000
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50,000
t/year
$825,000
$1,100,000
$1,375,000
ETS Financial Impact
Annual Reduction in ETS Obligations Assuming 50% Efficiency of LFG System
5,000
10,000
20,000
30,000
50,000
Price of Carbon/t
t/year
t/year
t/year
t/year
t/year
$15.00
NA
$82,500
$165,000 $247,500 $412,500
$20.00
NA
$110,000
$220,000 $330,000 $550,000
$25.00
NA
$137,500
$275,000 $412,500 $687,500
Annual Cost of LFG
System
$180,700
$195,150
$272,750
$336,500
Improvement in collection destruction efficiency of the LFG system will further decrease
ETS obligation cost for same annual operating cost
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ETS Other Impacts
• Increased operational requirements
– Design
– Operations e.g. staff, contractors
– Monitoring
– Reporting
– Aftercare
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Options Analysis
1. Do Nothing – pay the ETS obligation
2. Close the landfill and transfer to regional landfill
facility
3. Invest capital into own LFG collection and
destruction system
4. Segregate waste stream – process organics
separately from landfill. UEF derived for landfill
using SWAP
5. Hybrid of 2 & 4. Use regional landfill facility for
household waste. Develop local greenwaste
composting, RRC and “Other Fill” facility for
residual
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Key Issues to Consider
•
•
•
•
•
•
•
Community response to disposal fee increases
Regional Landfill - transport & disposal costs
Remaining landfill life (capacity, consent)
NES obligations
Landfill construction- likely LFG system efficiency
Segregation – integrated collection/handling systems
Hybrid – % of household waste diverted, integration,
cost
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Transport Cost
Waste Transport Cost per Tonne
80
70
Cost/tonne ($)
60
50
40
30
20
10
0
100
200
400
Distance return (km)
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600
Examples
1. <1500tpa Class B unlined landfill - no LFG system
geographically isolated, no practical regional
landfill alternative
2. 10,000tpa Class B unlined landfill, no LFG system,
regional landfill alternative <100km
3. 30,000tpa Class A lined landfill, no LFG system,
regional landfill alternative <200km
4. 50,000 tpa Class A lined landfill, no LFG system,
existing kerbside recyclables collections,
segregated organics processing, regional landfill
alternative 200km away
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Example 1. Small Isolated Landfill
•
•
•
•
•
•
Few small landfills
Most are isolated rural and may be exempt
Transport cost prohibitive >$50/t
Pay ETS obligations
Promote waste minimisation at home
Sort or process on site (community or levy
funded)
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Example 2. 10,000 tpa Unlined
• Likely uneconomic to install LFG system
• Pay ETS obligation
or, when economic
• Close and establish transfer station / shop
• Transport to regional facility less than 100km
away with efficient LFG system
• Transfer station is a long term asset
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Example 3. 30,000 tpa Lined
• Marginal economics installing a LFG system
– Collection efficiency >50% at risk
• Pay ETS obligation (or offset with credit)
or, when economic
• Maximise diversion processing of organics
• Reduce UEF to 0.6 by diverting 25% - greenwaste,
paper and wood
• Annual saving approx $400k, or $50/t diverted
• UEF based on SWAP (cost $60k)
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Example 4. 50,000 tpa Lined
• Transport cost to alternative landfill >$50/tonne
Options
• Do Nothing
– Calculate reduced UEF using SWAP
– Pay ETS obligation for reduced UEF
and/or
• Divert small remaining % of household waste from
landfill
• Remaining landfill not subject to ETS
• Future construction cost savings?
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Summary
• Option analysis - investigate carefully
• For some facilities closure and transfer will be
the best option
• LFG system efficiency risk – many issues that
can adversely impact on collection efficiency
making investment uneconomic
• Increasing price of carbon will drive greater
diversion from landfill – cap of $50 by 2017
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