Following Defra’s release of the illustrative base fees for EPR, and in anticipation of the announcement of actual costs to local authorities arriving shortly, we have been comparing these numbers against some figures of our own, which we have derived using data from local authorities.

We have taken data from several local authorities whose kerbside collection services we have modelled recently . A range of authority types were considered within these figures, who have varying levels of rurality, deprivation, and a range of governing arrangements. However, for simplicity, all authorities considered within this analysis operate a commingled collection of dry recycling from the kerbside, but we will look to expand this analysis to other collection systems.

To calculate these figures, we looked at the combination of materials captured through both the dry recycling and residual collections, and their respective annualised collection costs.

Dry recycling

• For each authority, we lifted the annualised indicative collection cost from our baseline KAT models for the dry recycling collection at the kerbside.
• We looked at this against the composition of dry recycling materials, which was either based on the local authority’s composition data, or using the KAT default composition.
• We then looked at the total volume of materials collected, based on average bulk densities lifted from the KAT model. This allowed us to find a volume-based, percentage composition, which was used to proportion the annualised collection cost per - material, which we then broke down to derive a £/t per material.
• We then combined this £/t for each of the materials with a nominal MRF gate fee (net, median MRF gate fee, excluding transport) from the 2023/24 WRAP gate fee report.
• This was all moderated by the proportion of obligated packaging materials within each material stream

Residual

• For the obligated packaging element within the residual waste we took a similar approach, with national residual waste composition and the proportions of the annual collection cost via a tonnage based distribution
• Treatment / disposal costs for a median EfW gate fee from the WRAP database was applied.

We focused on the following materials: Aluminium, Steel, Glass, Plastic, and excluded card/ composites due to limited data on differentiations within the datasets we had.

Combining the above approaches, we can make the following observations:

• The costs of managing aluminium through our LA sample ranged from £512 / tonne to £1,377 / tonne [Defra indicative ranges: £320 - £605] – therefore in general, the LA costs were at the upper end of the range or significantly above the range cited, we had 5 Councils which were in the £700’s / tonne, and one outlier at, £1,377, for a rural authority.
• The costs of managing glass through our LA sample were substantially higher than the Defra estimates, with even the low end of our sample exceeding the high end of the Defra range. Our sample ranged from £222 - £411 / tonne, whereas the Defra range was £110 - £215 / tonne.
• The costs of managing steel through our LA sample were £244 - £565 / tonne, with the higher end significantly exceeding the Defra Range [£220 - £330 / tonne], but most of the other samples falling within Defra ranges, albeit at the higher end.
• The costs of managing plastic through our LA sample were mostly below the Defra ranges, with our costs ranging from £247 - £547 / tonne [Defra range: £360 - £520 / tonne], with one exception which exceeded the Defra figure.

So what does this tell us?

We used a sample of 7 Councils, and the costs were largely either at the high end of the Defra range or significantly above, for all materials except plastic. One Council in a particularly rural area might be considered an outlier, but had the highest costs overall. We have not run this against Councils with other challenging factors (such as high % of flats or particularly low recycling performance), but that will be our next step. This also excludes other costs like litter management of packaging for which there is greater variability of costs and poorer quality data, but would also push up these cost estimates. These ‘bottom up’ calculations show that the ranges within the indicative base fees will be insufficient for some Councils without reform to their collection costs, and potentially may be insufficient for some material streams even with reform of services, in certain contexts.

Frith Resource Management undertake modelling and analysis on waste collection, management, procurement and strategy projects, see www.frithrm.com or email info@frithrm.com