Water & Wastewater Treatment Magazine
Issue link: https://fhpublishing.uberflip.com/i/840541
www.wwtonline.co.uk | WWT | JULY 2017 | 15 • There are 159 sludge-fed anaerobic digestion (AD) plants in the UK, but more than 500 AD plants in the country overall, according to figures from the Anaerobic Digestion & Bioresources Association. This shows the potential for efficiency gains if sludge was permitted to travel across water company boundaries and be processed by AD plants not currently run by water and sewerage companies (WASCs). • The first steps in the opening of the bioresources market is Ofwat's imposition of a separate price control for sludge as part of the PR19 price review process. WASCs will need to reveal what it currently costs them to deal with their sludge, as well as publishing data for each sewage treatment works on quality and volume of sludge produced • One likely early outcome of this is bilateral deals between WASCS to transfer sludge across boundaries where this makes economic sense and there is spare capacity in treatment facilities. Ofwat estimates that 13% of the sludge in England and Wales could be profitably transferred in this way; this is based on calculations that envisage sludge being transported up to 50km in distance but no further • Deals to transfer sludge to AD plants not currently run by WASCs – for example, those processing food waste, agricultural materials or industrial effluent – are also possible, but may require changes to environmental laws and regulations on co- digestion before they become economically attractive • Where new capacity on sludge treatment is required, the reforms open the door to new business models and funding for creating this extra capacity – for example, WASCs could create a joint venture to build a new sludge treatment works on near their mutual boundary, or the facilities could be funded, built or run by new players in the market • THE SET UP The Works: Sludge Compared to GB electricity demand the potential output is small. However, energy from gas derived from sludge is predictable, which should be of real value given the extent of intermittent generation. A longstanding aim of UK and EU energy policy is to reward stable and flexible generation. It follows that power generation is certainly an option to explore. However, the economics of smaller scale generation need to be treated with some caution at the moment. Subsidies can be difficult to get and Ofgem's review of embedded benefits is a revenue risk. There are also more practical factors. Sludge is bulky and expensive to treat and transport. It would be a brave commercial decision to seek to power a station on the basis of long distance sludge transportation. Ofwat expect sludge reforms to lead to innovation and integration with the "other organic waste sector". An example could be the use of sludge in co- digestion with other organic waste. There are a range of barriers, which Ofwat have been exploring. Some key barriers come from environmental law. There is a need to review this carefully. Whether this is practicable in the near term is at least a question. The responsible ministry is DEFRA, and DEFRA will bear a significant Brexit workload. A further issue is Parliamentary time to change the law. This may therefore be a longer term opportunity. Be that as it may, there must be opportunities arising from the deployment of the skills and knowhow of the wider waste sector in the context of sludge. In the long run convergence is highly likely. The point of Ofwat's reforms are not to prescribe any particular use of sludge – rather it is to use a market mechanism to reveal the value of sludge and, therefore, the potential uses for sludge. Other opportunities will doubtless be identified. However, technology is developing (such as advanced nutrient recovery and heat recovery) that could create new opportunities. The wider waste sector is also the source of commercial opportunities – incentives include reduction of landfill and lowering the cost of waste disposal. Cost can be reduced by creating revenue streams from gas from waste or the production of refuse derived fuels. There is a significant degree of innovation in the sector and that will continue. The focus on the waste sector is not only in the UK. The European Commission is focused on the Circular Economy agenda and is well aware that there are a range of significant untapped opportunities to extract value from waste streams, for example by producing biogas. It is examining potential reforms, for example in relation to fertilisers made from recycled waste sources. What happens in Europe will continue to be relevant to UK muck and brass. The UK exports significant volumes of refuse-derived fuel to the EU. EU investors invest in our waste sector and UK investors will look to take opportunities in the EU as well.