Independent Examination of Waste Core Strategy & Development
Management Policies
Hearing Statement by Old Hatfield Community Forum (OHCF) CS/M/504170
I
Introduction and Outline
1.
This hearing statement highlights major outstanding points from our earlier submission
of comments (in name of Tom Ryan) (ID: 504170) to Hertfordshire County Council
(HCC)’s Waste Core Strategy and Development Management Strategies. It updates
them with our subsequent considerations. These include:
 A note1 setting out outstanding questions on economic and technical matters that
Herts Without Waste put to HCC and Defra (Department for the Environment and
Rural Affairs), to which they received little response from HCC.
 Our presentation for the Welwyn Hatfield Environment Forum on 10 October to
Welwyn Hatfield Borough Council (WHBC)’s Environment Overview and Scrutiny
Committee’s session on HCC’s waste management strategy and proposed plans for
an incinerator at New Barnfield2. Our presentation was well received by WHBC
councillors who expressed considerable concern regarding the matters we raised.
 HCC’s Final Business Case (FBC) for their recommended solution. HCC have only
just submitted this late on 19th October. In order to meet the inspector’s deadline
for hearing statements of 21st October, we have only been able to consider this
briefly here. We may need to submit a supplementary written statement when we
have been able to examine the FBC in depth and consult on it more widely.
2.
The first part of HCC’s waste core strategy commendably stresses many important
points and principles, with which we fully agree. These include:
 p. 46. policy 1, “To ensure flexibility for the waste management industry and for use
of newer technologies, there will be provision for a mixture of small and large
facilities and waste management sites as appropriate”.
 Para 4.9. “Any proposal for importing wastes into Hertfordshire would have to
demonstrate best practicable means for managing the waste stream, and that its
social and economic benefits, including securing or creating jobs, outweigh the
impacts on human health and the environment”.
 Reducing waste miles and minimising transport are key criteria in policy 4.
 Para 4.10. Important that waste is dealt with as close as practicable to its source.
 Para 4.60. “Minimising the need to travel is a key national policy objective. The
principle is applied in Hertfordshire given that the county’s current transport system
is complex and congested with a heavy reliance on road transport”. Para 4.65.
“The local road network is frequently at, or near, full Capacity”.
1
Herts Without Waste (2011) Questions from Herts WithOut Waste (HertsWOW) in March 2011
regarding the assumptions and analysis in the OBC. 31 March 2011.
2
Fisher (2011) Economic review of Hertfordshire County Council’s Waste Core Strategy: Presentation to
Welwyn Hatfield Borough Council’s Environment Overview and Scrutiny Committee, 10 October 2011
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
3.
The problem with HCC’s waste core strategy is that it then suddenly on p. 88 jumps to
their summary recommendation 1 for a large 270kt thermal treatment plant which
contradicts these good principles above.
4.
Our hearing statement here highlights each of the following fundamental shortcomings
of HCC’s appraisal and evidence that does not support this recommendation and makes
it and their core waste strategy unsound.
1. Not consider and appraise duly the major alternatives (Matter 18 in Session 4)
2. Based on incorrect assessment of net waste arisings in Hertfordshire (Matters 3
and 5 in Sessions 2 and 3)
3. Shortcomings of HCC’s sustainability appraisal (Matter 11 in Session 4)
4. Flaws in HCC’s economic appraisal and evidence.
5.
As well as pointing out the limitations and unsoundness of HCC’s current waste core
strategy and especially their recommendation 1, we also constructively suggest how
HCC could overcome these limitations and carry out a proper options and economic
appraisal of the waste core strategy to derive a better solution for all.
6.
We identify above the specific matters and hearing sessions to which our points relate.
We sincerely believe that the economic matters in points 1 and 4 above are very
important and merit discussion at a specific session in the examination. We would be
happy to attend such a session to clarify and address our points if the Inspector wishes
this. We understand that the Inspector wishes to address economic matters regarding
points 1 and 4 above in other specific sessions as and when they arise. Since we are
unable to attend each and every session, we are submitting this written statement and
would hope that these points can be duly addressed at some stage in the examination.
II Options considered and appraised
7
HCC claim that “ no specific waste processing technology was excluded (Core policy
13)”. But this is contradicted by their actions in that they have not duly considered and
appraised major alternatives such as increased recycling and smaller waste treatment
options closer to the waste arisings, which could be less costly than a big incinerator.
8
HCC’s Waste core Strategy (p. 52) says that they shall take account of:
 Meeting a specific waste management capacity shortfall;
 Scale and timeliness of providing facilities contributing to short-term capacity gap
in waste management;
 Proximity to and service provision for major urban areas and main population
areas;
 Location within or adjacent to established or proposed Employment Land,
Previously Developed Land, Industrial Land or compatible land use; and
 Minimising transport distances to the existing network of waste management
facilities and the strategic road network.
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
8
HCC’s FBC3 incorrectly applied the following screening and selection criteria.
 (Because of the long lead times in developing a major plant) the facility should utilise
a proven technology, an approach that should assist delivery of ‘best value’.
 The facilities should be developed in modular form with increased capacity to meet
increases in residual waste.
9
Similarly HCC’s Outline Business Case4 (OBC, p. 60) reported that their Technical
Options Appraisal should consider developing:
a. A single site solution of 400,000 tonnes capacity to meet its long term needs but
providing short term options for third party inputs
b. A modular approach to the single site solution to meet anticipated increases in
residual waste and take advantage in developing technologies
c. A multi-site approach that would be close to the location of the waste arisings and
could use different proven technologies and providers to ensure flexibility and
competition.
10 However, HCC do not reconcile the contradictions between these criteria. It appears
that (a) trumps everything and that they have applied the selection critieria
inappropriately just to rule out alternatives and consider only large scale plants, which
Section III below shows grossly exceed Hertfordshire’s net waste arisings. This all looks
designed to go for their apparently predetermined choice of a large incinerator at their
selected location of New Barnfield.
11 We outline in para 27 below how they could apply their modular approach in the waste
core strategy to arrive at a better solution.
III Net Waste Arisings in Hertfordshire (Matters 3 and 5 in Sessions 2 and 3)
12 Herts Without Waste are submitting an in-depth analysis of net waste arisings in
Hertfordshire and their implications for HCC’s waste core strategy. Therefore we here
just highlight key points relevant to the options appraisal and economic appraisal.
13 Figure 1 reproduces a graph from the note of outstanding questions5.
A) The blue curve represents actual municipal solid waste (MSW) arisings in
Hertfordshire from 2001 to 2010.
B) The magenta curve shows the predicted waste arisings from scenario 1 that HCC
chose in their Outline Business Case (OBC).
C) The yellow curve shows our prediction of arisings based on falling levels of waste
per head population, but rising population. In reality they are likely to be lower.
D) The green curve is the amount of ' net residual waste' to be processed, based on
the percentage levels of recycling/composting shown that can realistically be
achieved in the light of actual achievements elsewhere.
3
Hertfordshire County Council (2011, p. 41)) Hertfordshire Waste Procurement Programme: Residual Waste
Project Contract Reference HCC0902062: Final Business Case
4
Hertfordshire County Council (2009). PFI Credits: Outline Business Case. February 2009
5
Herts Without Waste (2011) Questions from Herts WithOut Waste (HertsWOW) in March 2011
regarding the assumptions and analysis in the OBC. 31 March 2011.
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
E) The red line at the 350,000 t.p.a. level is the capacity of Veolia’s proposed
incinerator. This is greater than that recommended in HCC’s waste core strategy
(270,000 t.p.a) and far exceeds the residual net waste arisings for disposal.
14 HCC’s only response to Herts Without Wastes’ note was they are only committed to
delivering 180,000 tonnes of MSW to the incinerator6 and that the incinerator would not
disadvantage recycling. HCC’s FBC (p. 7 & 16) commits to achieving a minimum target
of recycling at least 50% of MSW and “will continue in its efforts to improve in this area”.
It goes on to say (p. 26) that “ The HWP is engaged with WRAP’s Recycling and
Organics Technical Advisory Team (ROTATE) kerbside support programme, and is
proposing a 60% by 2020 recycling target in the emerging LAA”.
15 This raises significant questions concerning from where Veolia will obtain the big
shortfall of wastes for the capacity of the proposed incinerator. HCC have said that it
will be up to Veolia to bring in commercial and industrial wastes and wastes from
outside Hertfordshire. But this would considerably increase transport problems.
Moreover, there are existing plans or proposals for incinerators and waste treatment
plants nearby to treat more than 1m tonnes of waste pa. So there are serious risks that
throughput for Veolia’s proposed incinerator at New Barnfield would be well below its
design capacity (of 350,000 t.p.a). Key unanswered question is what are the
implications of this, especially concerning local recycling, and who will bear any such
costs. Any costs should not fall on Hertfordshire residents and council tax payers.
IV HCC’s sustainability appraisal (Matter 11 in Examination Session 4)
16 HCC’s sustainability appraisal is inadequate. It looks to be essentially designed to show
that the selected option is ‘not too bad’.
6
Hertfordshire County Council (2011, p. 41)) Hertfordshire Waste Procurement Programme: Residual Waste
Project Contract Reference HCC0902062: Final Business Case
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
17 It gives no quantification of the scale, nature and significance (and costs) of the
environmental impacts of the options, especially recommendation 1 for a large
incinerator – see Section V below. Moreover, there is no assessment of how the
environmental impacts could be reduced (or minimised) by selecting other better
options.
V Economic Appraisal for the Waste Core Strategy
17 HCC’s recommendation 1 in their core strategy for a large incinerator is not justified or
supported by an adequate economic appraisal and evidence. Its economic appraisal
does not conform to the following fundamental tenets of Government guidance such as
Defra’s Wastes Infrastructure guidance7 and HM Treasury’s Green Book on Appraisal
and Evaluation in Central Government8:
a. Not considered duly all major alternative options (see Section II above)
b. Defra’s Wastes Infrastructure guidance9 stresses the need to assess the “Full
Economic costs” of the options. This includes:
i. Not only the financial capital and operating costs of waste disposal; but also:
ii. Financial costs of transporting the waste, which largely fall on the district
councils. Section II highlighted that HCC have inappropriately screened out
smaller scale options for disposing of waste closer to its arisings and which
might have lower costs, especially lower transport costs. Moreover, Section
III suggests that a big incinerator at New Barnfield would involve significant
transporting of wastes from outside Hertfordshire.
iii. Economic costs of all resources and assets affected, especially the value of
the land at New Barnfield which, in line with the Treasury’s guidance, should
be valued positively as its best alternative use – not zero as appears to be the
case in HCC’s appraisal. In drawing up their waste core strategy and
pressing for recommendation 1, HCC seem to be driven in a blinkered way by
focusing on their owning the site. But, in line with the Treasury’s guidance,
this is irrelevant to a proper economic appraisal to determine the best option.
iv. The full environmental costs of the options have not been quantified and
included in the economic appraisal. This is especially significant for the
increased environmental costs of transport in terms of:
 Congestion, noise and local air pollution. These can be calculated and
valued using DfT’s WebTAG10 for appraising transport projects;
 Emissions of greenhouse gases emissions causing climate change.
Similarly these can be calculated by applying emissions coefficients to
estimates of tonne miles travelled and valuing the total emissions using
DECC’s carbon values11.
7
Defra (2008) Waste Infrastructure Delivery Programme Residual Waste Procurement Pack
Module 1 Options Appraisal and the Determination of the Reference Project for the
Outline Business Case.
8
HM Treasury, The Green Book: Appraisal and Evaluation in Central Government.
9
Defra (2008) Waste Infrastructure Delivery Programme Residual Waste Procurement Pack
Module 1 Options Appraisal and the Determination of the Reference Project for the
Outline Business Case.
10
see http://www.dft.gov.uk/webtag/
11
See http://www.decc.gov.uk/en/content/cms/what_we_do/lc_uk/valuation/valuation.aspx
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
c. HCC have not carried out any least cost optimisation to determine the least cost
option for Hertfordshire.
VI Financial costs
18 HCC propose a highly capital intensive option – a big incinerator. Their costs of
financing these capital expenditures (through PFI) are high. The precise rate is redacted
in HCC’s FBC. But we estimate it to be about 8%, which is similar to the figure that the
House of Commons Treasury Select Committee12 derived in their recent in-depth
inquiry. This rate is much greater (by at least double) than the Public Works Loan
Board’s rate for public finance for Councils. This Committee’s report was severely
critical of PFI schemes which they considered to be very costly and poor value for
money. Therefore it appears that HCC’s proposed plans for a big incinerator will be
much more expensive than the alternative options and will entail a high financial cost
and burden to tax payers.
VII Seeking a waste core strategy with a least cost solution
19 HCC have not demonstrably sought the least cost solution for Hertfordshire in deriving
their waste core strategy. They just assessed their preferred option of a big incinerator.
20 They should have carried out a least cost optimisation. This could be similar to that done
by the water industry in their Water Resource Management plans to find the least cost
way of supply water13. This would rank options in terms of their full cost/tonne of waste
treated (as set out above) selecting the least cost first to give the lowest overall costs for
managing Hertfordshire’s wastes. In this, consideration should first be given to items at
the top of the waste management hierarchy (of reduction, reuse, recycling, composting
then energy recovery) - as HCC’s waste core strategy rightly stresses in their para 4.5.
21 In this, the costs/tonne should be the average costs per tonne of the net residual waste
arising which that option could actually treat in the sequence of options given by this
optimisation process. This is a procedure similar to that which the water industry should
follow for large capital options such as reservoirs. This average cost is not derived by
dividing the costs by the potential capacity of any plant (such as a large incinerator).
22 The analysis should be done over a long time horizon covering the life of major options
such as an incinerator and should allow realistically for likely projections in waste levels
and developments in the efficiency and effectiveness of technologies and options.
12
House of Commons Treasury Select Committee - Seventeenth Report: Private Finance Initiative.
http://www.parliament.uk/business/committees/committees-a-z/commons-select/treasurycommittee/news/pfi-report/
13
– see UKWIR (2007) The Economics of Balancing Supply & Demand (ESBD).
http://www.ukwir.co.uk/web/ukwirlibrary/80558
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
23 In line with Defra’s recent supplementary guidance on how to allow for uncertainties14,
the appraisal should pay particular attention to examining the potential for costly errors
in any irreversible capital options (such as a large scale incinerator). This includes the
costly errors of undermining the development and application of technological changes
and more flexible options such as increased recycling and small scale waste treatment
by UK companies.
24 Such issues were recently carefully examined in-depth by the Planning Inspectorate in
their inquiry concerning Thames Water’s proposal for a large reservoir15, which
concluded (in para 15.1.1) that:
“I find that because of a number of deficiencies in the Plan, it is not possible to
conclude that the supply of water so maintained would be efficient and
economical…Furthermore, I find that the Company’s description of the methodologies
used through options appraisal and programme appraisal is not robust, such that the
measures it proposes to adopt in order to meet its obligations under the Act are not
fully justified by evidence.”
25 Defra’s guidance is relevant to HCC’s Waste Core Strategy here since it is relevant to
large irreversible capital intensive waste management options such as incineration that
in many ways mirror Thames Water’s proposal for an irreversible large capital intensive
reservoir. Our more flexible alternatives of waste recycling and reduction are likewise
similar to the alternative water management options in the Thames Water case.
26 Therefore we suggest that a similarly in-depth scrutiny of HCC’s economic appraisal and
evidence in their Waste Core Strategy would yield the much same conclusion as in the
Thames Water case. Consequently, in the light of the severe shortcomings we have
highlighted in Sections II – VII of this statement, we would thus conclude that:
“because of a number of deficiencies in HCC’s Waste core strategy, it is not possible to
conclude that the proposed large incinerator would be efficient and economical... HCC’s
description of the methodologies used through options appraisal and programme
appraisal is not robust, such that the measures it proposes to adopt ...are not fully
justified by evidence.”
27 HCC rightly wish to reduce the level of wastes going to landfill and reduce landfill tax
payments. But they could achieve these goals more efficiently by applying their
proposed modular approach and going first for interim solutions such as building on the
recent advances in local recycling to go for modest and achievable further increases in
recycling rates and a small scale MBT/AD plant - as Veolia are building in North London.
This could then enable HCC to improve the effectiveness and efficiency of these options
and develop their waste management strategy most efficiently as the effectiveness and
costs of the various main options and technologies improve. This approach would also
be fully in line with HCC’s waste core strategy’s correct emphasis upon ensuring
flexibility of options and dealing with wastes as close as practicable to their source.
14
see Defra. HM Treasury (2009), Accounting for the Effects of Climate Change: Supplementary Green Book
Guidance. http://www.hm-treasury.gov.uk/green_book_guidance_environment.htm
15
Planning Inspectorate (2009) Inquiry into Thames Water Revised Draft Water Resources Management Plan
2010 – 2035. Report by Wendy Burden to the Secretary of State for Environment, Food and Rural Affairs.
http://archive.defra.gov.uk/environment/quality/water/resources/planning/hearings-inquiries.htm#thames
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.
VIII
Summary and Conclusions
29 HCC’s Recommendation 1 for a large 270kt thermal treatment plan in their Waste Core
strategy is fundamentally flawed and unsound. It contradicts Herts’ main strategy which
makes some important and valid principles and points (see Section I).
30 This recommendation 1 is the wrong solution. It is too big. It is not justified by any
substantive evidence and any proper and sound appraisal and comparison of
alternatives. Section V highlights that there are fundamental flaws in HCC’s economic
appraisal of its Waste Core strategy. Therefore there are high risks that this
recommendation 1 would be very costly in financial, economic and environmental terms,
which we fear would be unjustifiably imposed on Hertfordshire and Hatfield residents.
This recommendation 1 of HCC’s waste strategy cannot be taken forward on the basis
of this strategy given its inadequate and unsound evidence base and justification.
31 HCC need urgently to examine fully and fairly all main reasonable options and carry out
and publish transparently a proper economic and sustainability appraisal of its waste
strategy. Section VII outlines how they could do this. HCC then need to rework their
findings and recommendations accordingly so that they are properly in line with the
important and valid points that the main part of their waste core strategy rightly makes.
Hearing Statement by Old Hatfield Community Forum (OHCF) on the flaws in the Economic
Appraisal and Evidence in Hertfordshire County Council’s Waste Core Strategy.