What's Next for Energy-from-Waste?

Cameron:

Hello, and welcome to Ashurst Business Agenda. And this, our very first episode in the special Powering Change miniseries where we'll be delving into the findings of our report, exploring the statistics, and looking at the technologies fueling the future of the energy transition. In particular, we'll be looking at the UK energy from waste market.

My name's Cameron Smith and I'm a partner in the projects and energy transition team at Ashurst. I specialise in the project financing of infrastructure and energy projects, but particularly experienced advising on the UK and international projects across the spectrum of energy transition technologies. However, over the last 20 years, I've probably spent over 80% of my professional life focused on energy from waste, biomass and biogas projects.

And I'm pleased to be joined today by two really exciting guests, both of whom Ashurst has worked with extensively over a number of years.

Firstly, we've got Stefan Barrow. Stef is director in the infrastructure team at MUFG Bank, Japan's oldest bank, Japan's largest bank, and the fifth-largest bank by assets in the world today. Stef's been part of the team since 2012 and he's seen the waste market evolve from its historic PPP/PFI route to the merchant style projects you see today and having been involved and closed approximately 12 UK energy from waste projects. Prior to that, Stef worked for a London law firm in their project finance team having moved across from South Africa in 2007. In addition to the waste market, he's responsible for new technologies at MUFG and he's been very involved across a number of different sectors, both here in the UK and abroad.

We also have today with us Andrew Howie. Andrew is director of EfW Development at Encyclis. He's worked in the waste management sector for over 20 years. He began his journey working on and bidding for the earliest waste PFI procurement projects. He then moved into consultancy at Jacobs for 10 years and worked across a wide range of waste projects supporting a variety of public and private sector clients. He then had a slightly sideways move when he joined Air Products and spent five years working on the Teesside gasification plants. He's now been at Encyclis for the last six years, growing a successful UK EfW business and a pipeline of projects.

Ashurst works extensively with both Andrew and Stefan on the development and financing of the approximately £600 million Walsall Energy from Waste project, which reached financial close immediately before Christmas last year, the latest such project finance deal in this market. Together we're going to be taking a look at the current state of the energy from waste market and then we'll turn our sights on to what's next for this exciting industry. This comes off the back of the findings of Ashurst's 2024 Powering Change Report, which looks at the technologies fueling the energy transition.

Our report shows that energy from waste is one of the core technologies of the energy transition, with 41% of surveyed G20 energy sector leaders currently investing or planning to invest in EfW. However, in such places such as the UK where we've seen a lot of these plants built over the last 10 or so years, we can sense there's perhaps a degree of market saturation, which brings us back to today's discussion, what the market looks like today and what's next in the energy from waste industry.

To get started, Andrew, you're probably best to start with. There's been some significant changes over the last 20 years in the treatment of residual waste, resulting in a massive shift that we've all seen from landfilling through to energy recovery technologies. How do you sum up the current state of the market and recent developments?

Andrew:

Hi, Cameron. Yeah, that's a great question and a great observation of the journey we've been on. I do feel from somebody who's an operator, sort of a developer, builder, owner and operator of energy from waste facilities that we are definitely reaching a market maturity. There was a hiatus that was started with the PFI projects to build out facilities. There was a lot of competition from companies to build them and companies to do EPC, but as the market's matured and we, over the last five years have developed out these merchants facilities, I think as we look around, the EPC market's got tougher.

The ability to contract bankable long-term fuel supplies has got tougher.

And I think if you bring those two elements together, I do believe we're really getting to the end of that journey of EfW plans, which has been essentially a generational journey of 25 years. I still believe there's one or two good projects left, but definitely it's coming down to the catchment areas that still have the good waste and fuel sheds and then the ability to contract an EPC price that's competitive to make the model returns and to make these projects viable. Yeah, market's definitely maturing and recent developments has seen that slow down and there's probably one or two good projects left to get done, and then it might be at the situation where we're sort of at parity with bankable fuel and capacity.

Cameron:

Yep. Okay. You talked a couple of times there about bankable fuel supplies becoming a little bit harder to secure. What have you seen with regard to the fragmentation of the waste market between, on one hand the tier one waste management companies that everyone five or 10 years ago was chasing ardently, through to the aggregators and the smaller more localised operators that we're probably seeing being chased a little bit more these days as those tier ones are a little bit more elusive?

Andrew:

Yeah. That's an great question and observation. I think you're right. When you had the PFI days, it was the big waste companies with security from municipal supply to get these projects financed. And as we've moved along that sort of evolutionary curve, we are now seeing that there is waste available out there. There still is a layer of waste that's held by the smaller local companies, the regional companies that have good real estate, good assets of transfer stations and treatment facilities, but smaller tonnages.

The layer below the tier ones, which is a layer that maybe gets overlooked in recent years, they've become more and more important as we sort of discussed there, that tonnage is available. You have to go out and do the hard miles and put some boots on the ground and speak to these people. But if you get to know these people, they are good companies with good waste and if they're willing to come on the journey and we're willing to go on the journey with them, I think these are the operators that will help get these last couple of projects done and fill the gap between where the tier ones view the world as and then where some of the more local companies who actually control the waste fit into the puzzle.

And ultimately, Cameron, it gives these people direct access into EfW so they don't have to go through municipal contracts or the tier ones, they don't have to go through aggregators. They can have a direct relationship which will be helpful for the energy from waste owners and operators and also helpful for them. So they know they have certainty of supply and if they can sign contracts, it can maybe help them invest more in some of the infrastructure that they need to move them to the next level of their development evolution.

Cameron:

That's interesting observation. So do you find that these smaller waste management contractors are actually seeking you out when they know that you've got a potential site or a plant coming on? Do you see them working harder also to find outlets for their waste?

Andrew:

Definitely, Cameron, I do, and I think they are all trying to sort of get the challenges of increasing landfill and diversification and they are now seeking out domestic EfW, which maybe they hadn't had that access before too due to geography or just due to how contracts were structured. So there is a lot of local tonnage out there that maybe had to travel farther than they should have travelled just because of how facilities are previously being supplied and financed. And there's some good examples of that in the Midlands and the Southwest and even in Northwest where the tonnage available and people are seeking out.

The challenge is just getting them to understand that if you're building a plant, it takes a number of times and a lot of these people work in a sort of a shorter timescale than a tier one. A tier one can be a little bit more strategic and bank ahead for two or three years and try and get maybe some municipal contracts lined up to support their commercial waste, whereas local companies signed a contract and want to supply the next day, which is good because it shows enthusiasm, it shows they've got the tonnages, but there's just a bit of a journey and an education where you have to explain to them, these projects take a little bit of time to develop, but we'll get there. And this is the start of the journey, not the end of it.

Cameron:

Yeah, no, I think we've all been on those long journeys in developing these plants. Stef, if I can bring you in, how do you see the funding market responding to these changes? Because there has been a seismic change over the way these projects developed and in some ways the risks that funders are now being expected to take on that previously we don't think they would've even looked at.

Stefan:

Yeah, that's an excellent question and I think the best way to describe it is it's been an evolution over time and I think Andrew referenced the fact over 25 years that the market has grown. And I don't think we should underestimate that. I still maintain that the introduction of the landfill tax is one of the shrewdest pieces of legislation that's been introduced in the UK, and I think this is where UK PLC is really very good at understanding how to introduce measures that are able to drive the right behaviours in a market and effectively creates an industry. If you look at where landfill was way back when it was first introduced, 90% of waste going to landfill versus where we are today, and they've had to do that without any other major intervention, allowing the market the space to effectively create the room to move around, this has been really I think a tremendous success story.

Now that's taken on different forms over time. So certainly with the early PPP deals, I think waste was a little bit of an unknown quantity from a lending perspective, but you can definitely see how that has then evolved from there as we've introduced these more merchant-type schemes without the coverage of a PPP/PFI sitting behind it and then just being a little bit creative. And I think that for me is the big change that we've seen over time is lenders are much more nimble and willing to look at opportunities in a more flexible way. I think they've gained a lot of confidence over the last 10, 15 years looking at different types of infrastructure and infrastructure classes and being able to be a little bit more creative around the risks.

So if you take in Andrew's example of looking at tier two contractors 15, 20 years ago, people would never have been able to get their head round that, but over time you build a thesis, you start with the tier ones, you show how it fits together, you're able to demonstrate there's enough waste in a catchment area that even if you look at a slightly different risk profile of a contractor, as long as the waste is there, there's a way to build a financing story around that. And I think that is what then creates the confidence.

The important thing for me is that ultimately lenders go where their clients are, and if clients have looked at EfW in a meaningful way over the last 10 years as they have, then there's no doubt that you create a lending market around that. And you've definitely seen how that has grown. You do the first deal, you're then relevant on the second deal, you might do the advisory on the third deal, and suddenly you're looking at an M&A situation on the fourth or fifth deal, and that's how you see lenders come into the space.

I definitely think we are now at a junction point, I think Andrew makes a very good reference to the market coming into some sort of balance. I think it's the point at which the sponsors get their tracksuits off and start thinking about new and exciting areas to go into. And I think certainly carbon capture is going to be the next big topic for the industry as a whole to solve. So I think all of that capital that you've seen move into the EfWs will still be there potentially for refinancing of platforms, potentially for some more M&A opportunities. But I think that the big greenfield facilities, we're gradually seeing that pipeline come to a close now.

Cameron:

Thanks for that Stef. I think that flexibility and pragmatism by the funders is probably going to be really important when we move into the next phase of how we treat waste across the UK given that new technologies are being brought forward. I think that flexibility is going to be critical. So you see that there has been a change in appetite from funders in a positive way, which is great and what do you think's been behind that change. Is it because it's a more mature market? Is it because there's not a lot of other projects out there for them to lend to with the death of sort of PFI or temporary death of PFI?

What do you think?

Stefan:

It's a combination of all of that to some degree, Cam. I think if you look at the margins that lenders tend to be able to attract across other parts of the renewables universe, those tend to be a lot tighter in terms of how they're both structured and priced. And waste, I think, has always had a little bit more of a premium attached to it because there's a few rougher edges, if I can put it that way. That allows people, I think, to see an opportunity. And again, you've seen a number of very significant infrastructure investors move into the place and they're able to mobilise very large pockets of liquidity that sit behind them, getting people to look at things in different and creative ways. So I think that's provided a good baseline for people to do more.

Cameron:

Okay, good. Thanks for that. So from that very positive note, there's obviously some challenges now that we're having to deal with. Andrew, if I can bring you back into this, what do you see being the principle challenges and I think the one that everyone is aware of is the Emissions Trading Scheme extending to energy from waste, which we're all looking at and adapting to. But in addition to ETS, what other challenges do you see in the market for this sector?

Andrew:

Yeah, it's another great question, Cam. I think it touches on what we discussed a little bit earlier where the challenges are coming down to sort of the EPC, the ability of contractors to come to the UK and build it. We're seeing a tightening in supply chains from Continental Europe. We're seeing the challenges of people wanting to come to the UK and then just the inflationary end price increases on a number of these contracts, which is pushing the EPC price quite high. And that's becoming a challenge as to get a bankable EPC and then a financing model that works because ultimately the waste was in a gate fees or in a tolerance of where they sit with landfill and export and alternatives. So there's always a sweet spot to try and secure those.

So I do see the EPC market as a challenge. And then we talked about earlier the capacity of available material that's left. And like you said, the ETS, we all see it coming down down the track towards us. I think anybody who told you they knew how it was going to work out or how it actually is going to fit together is probably being a bit disingenuous. I think as a market we appreciate it's coming, but as Stefan touched on earlier, the key legislation was landfill tax and that took a generation of evolution and we had certainty and we knew when it was going to come in and we knew what the bands were going to be for a number of years so people could plan, Cameron, they could get prepared for it because to deliver this infrastructure as we know, takes three or four years to develop it, three or four years to build it.

It's not something that happens overnight in my personal opinion on the emissions trading scheme is we need another level of certainty. We know it's coming, we're trying to deal with waste, we provide public sanitation as first and foremost. We're an industry that can cope. We're an industry that copes in the dark behind the scenes and we get stuff done. But that's taken a generation, 25 years to get to this mature point. My sort of plea to the sector is that the sector has to address ETS. The sector has to now think that we've gone from getting waste out of a landfill. There's still quite a bit of waste that goes to landfill, municipal and commercial that will hopefully get mopped up in the next couple of years. But if we move to ETS, let's have a market conversation about how this is going to impact the market and how we can react to it and set out a journey. A bit like landfill that we went on.

We know it's coming. There'll be some technology fixes from carbon capture and we are involved in spearheading that at the high-net project in Protos. So we are at the forefront of understanding how that's going to work from a technical point of view and also a legislation point of view, but not everybody's going to have access to these networks. So it's really what's the national solution going to be and could be doing more stuff up front with processing waste before it gets to the energy from waste plant. So there's more ability of intervention there.

So I think it'll be more of a dynamic approach to it. And I think if we have a bit more certainty and a bit more of a pathway to follow, and it's not just going to be a blunt instrument used to beat this industry, because this is a great industry and this industry copes and provides great service, but we just need a bit of a help and a bit of a steer to go to the next journey, which is to deal with the carbon. We're good at dealing the waste, let's figure out the best way to then deal with the carbon and we're in a good place to help that because as Stefan sort of highlighted earlier, we can mobilise capital, we can deliver, we can build, we can operate, but we just need a legislative framework that gives us that opportunity to do that without getting penalised with a big stick before we get there.

Cameron:

And I think that's a really good point, I think, because I think one of the benefits, the way the landfill tax worked and the reason it worked so effectively is because I think government gave long-term policy direction as to what was going to happen with landfill tax for many years into the future. And everyone took that and built their plans around it. And I think with Emissions Trading Scheme and carbon capture, what we need is that long-term certainty because as you say, every industry can adapt well to policy changes and to legislative changes, but they need plenty of time to do so to build those supply chains. And I think that's a good point that if we take a leaf out of the book from the way that landfill tax was implemented, what it needs is long-term certainty and the industry will adapt as a result of that. But what we don't want is any sort of short-term surprises because it doesn't give the industry sufficient time to adapt.

Andrew:

Completely, Carmen, and we don't want to rush in to make decisions before we've maybe got all the information available of certain technologies and interfaces and how these things work commercially. And I think giving that sector long-term certainty to plan and to develop is in everybody's interest, the best interest for the industry and the best interest for the government and the taxpayer who ultimately will end up funding a few of these projects to get things going.

Cameron:

Yeah, no, absolutely. Stef, did you have anything?

Stefan:

Yeah, I was just going to say these things take time as well, Cameron. If I think about where we started with landfill tax and Andrew made the point around 25 years, if we sit down and talk to developers and what's the investment horizon look like in terms of getting DCOs in place and building, it's all going to take time. Where government can really help is providing that certainty of direction. And I think that's really important. So if we look at the various tracks for the high net cluster for example, and how that all fits together, I think that's a really important building block. If you get that up and running and you show that there is a whole way forward for the sector as a whole and that this works, I think it will unlock heaps of opportunities elsewhere both to plug into those clusters, but also to do standalone carbon capture and storage and use that carbon for other industrial applications because there will certainly be a market that's now created that allows you to develop that. And I think that is very exciting in terms of what future opportunities may bring.

Cameron:

And I think that's a really good segue there. Thanks, Stefan. So probably a question for both of you. Where do you see the real opportunities going forward? Andrew's already talked about the fact that there may only be one or two big energy from waste plants helped in the UK still to come, but that means there's a lot of capital out there, there's a lot of expertise, a lot of knowledge. Where does that get redirected and where are the opportunities for each of your organisations?

Andrew:

Another great question there, Cameron. Looking ahead, I think the opportunities for us are to build out the projects that we have in build. So we get them built up, we get them through COD, we get them operational. Our latest project that we just reached financial close on before Christmas, the end of last year was Walsall. So my priorities and our challenges are to get that built on time and on budget, which we're hoping to do. We've got a great EPC contractor on board.

And I think then opportunities, Cameron, that might come out of, we talked about earlier, is a way to look further into that supply chain of where the waste comes from and how these suppliers operate. So there could be opportunities there to do more stuff maybe up front of the energy and waste plants. I do still feel there's quite a bit of tonnage out there that needs to come out of landfill and we need to start thinking about how we can have landfill as a last resort and how we can get more material into the supply chain and circulating and providing an opportunity for existing plants or for these last couple of plants that need to get built out.

And then we talked about downstream, once you've processed it, what are the opportunities you've got? We'll have emissions out the stack if there's a way to capture that carbon and do something with that, whether it's storage or maybe upgrading it to higher value products and then looking at potential district heating private wires. So stuff that's not sort of any technology list but still takes a lot of time and effort to develop and form relationships. Now you've got the facilities built, you can have maybe proper conversations about providing private wire or energy parks or district heating at specific locations. And it wouldn't fit for every plant, but I think it's something as an industry, due to the commercials and the legal complications, we haven't been a good developing district heating and private wire as all European counterparties are. And I think that's something that as a sector has got a good opportunity to do these as well as looking at the carbon capture, we could look at some of the more basic standard stuff to do.

And then finally from a residues point of view, we find partnerships and invested capital and processing the ash that comes out of the bottom of the plant. So there's looking at extracting the metals in that material, the smaller micron sized metals maximise recovery or turning it into construction to replace over the primary aggregates and then doing stuff with the flue gas treatment, working with companies that are turning that into blocks. So I think there's some new technology stuff, but there's also just getting better at business as usual, Cameron, and investing more in the stuff that works, but putting time and effort into the business relationships rather than taking technology risks. It's maybe more time and effort into developing the commercials and the legal frameworks that allows us to do more with the products that these energy from waste plants produce.

Cameron:

Yeah, no, I mean that's really interesting because often we look forward to the next technology and lots of talk about sustainable aviation fuel and all this sort of stuff, but the reality is there is a huge amount more we can do with existing operational assets to sort of supercharge and increase the value of those assets by, as you're saying, extracting as much energy out of them through heat offtake, maybe data centres, maybe district heating networks. It sounds like that is going to take a lot of time in itself just making sure that your operational assets are working as efficiently and effectively as they can.

Stefan:

Cam, from our perspective, it's a similar sort of philosophy that we have. I think we made the points at the top of the call, we ultimately go where our clients are. But the way we think of it is we've built out a thesis on the energy from waste space as a standalone, but in doing so, you develop a whole set of structuring skills that become very relevant for all the adjacent sectors. And I think what we've come to realise across the energy transition space as a whole is that you've got to look across the whole of your financial toolbox and start borrowing concepts from different structuring parts of the universe to stitch together some of these new projects. So if you've done EfW, then that's clearly a good start for carbon capture and storage. If you've done other parts of the CCS universe, okay, well, how do you stitch that together here? We can definitely see the world of district heating being an important component for that.

And also other things particularly around waste plastics and what else could you do with that? Can you turn that into some sort of oil-based process that helps other sectors of the industrial spectrum decarbonize? Because a lot of them don't have great decarbonization stories and this is a small way that we can do that. So optimising every part of an energy from waste facility, I think, strikes us as a very good idea. I think more practically there is still what is left of the remaining pipeline to build out where that is possible. I think there's a medium-term wave where you see a lot of life extension of existing facilities, particularly in circumstances where local authorities are a little bit cash strapped and how do they manage that? Can certainly see incumbent operators going along and saying, "Look, can we do a little bit of a deal here? We can squeeze an extra 10, 15 years out and there's a little bit of CapEx refresh we can do around that." Certainly see that as a theme both here in the UK and in Europe.

And then I think there's a whole host of new markets that are looking to develop. So there's been a lot of activity in the Middle East where they're trying to embed a lot of this from scratch. So having to create the regulatory frameworks that support it and then build out the capacity behind it, all of which is potentially very interesting. And we must have an inbound query at least once a week from Asia for people looking for advice as to how they might go about it. And again, for me, that takes it back to if you start from a good regulatory base, you've got a whole world that can potentially open up in front of you.

Cameron:

That's interesting you mentioned the Middle East. I was sitting at dinner with a colleague, there was a lot of Middle Eastern work yesterday and he just mentioned that the Abu Dhabi energy from waste project reached financial close yesterday. So it's very timely you mentioned the Middle Eastern markets. I know we started looking at that with some of Andrew's former colleagues, some probably about five years ago now. So it's great that there is still a lot of activity in other regions.

Just whilst on regional development. Do either of you see any opportunities in Eastern Europe? Because I know certainly from Ashurst's point of view, we did get involved some time ago in some Romanian energy from waste projects. A lot of these projects sometimes are let down a little bit by the governance and policy structures in place in those countries, but do you see Eastern Europe or other areas closer to the UK having opportunities?

Andrew:

I mean, definitely, Cameron. As you say, it comes back to what Stefan was talking about. If the regulatory framework is there and the governance is there and you've got certainty, then clearly you can generate a market. I mean, a lot of these things have previously been stimulated by European government funding to get projects away and it's maybe then not moved on to the next phase where merchant facilities come along because the fuel story is there regardless of any sort of incentives. It's not something that we've traditionally looked at. And I think it's just because we've been so busy in the UK and there's been so many opportunities in the UK to build out these merchant facilities over the last five, six years. Now that that's coming to an end, I think we've got a great template about how to develop these facilities, how to build them, how to operate, and then more importantly how to finance them.

So I think if there's an opportunity where we can bring our abilities in terms of financing and building, then I think Eastern Europe could potentially open some doors for us. Maybe the challenge is with a British company working there and those issues, but I think definitely the UK can be a good model for how to do it and a lot of sort of similar developed countries that are trying to move away from landfill and develop these technologies. And maybe they can learn a few lessons and have a few shortcuts from what we did and think about it a bit differently, but definitely I think there's an opportunity there. From our point of view, it's something that we maybe look to as an emerging marke.t we should consider them a bit more seriously than we have previously.

Stefan:

The other really interesting point there, Cameron, because I think there's huge opportunity in those, well, a huge need, converting that's an opportunity maybe a little bit more complex, but we do a lot of what we call blended finance. So it's not conventional bank lending, but it's mobilising effectively IMF and other support and repackaging that in a way that allows you to crowd in private capital. And that, I think, is exactly what is needed for those markets. So if it's not so easy for a conventional senior debt lender to take that risk, but you've got that institutional heft from the World Bank and others coming in behind and then you're mobilising private capital alongside, that feels to me like a very interesting opportunity. And we've seen that model deployed not yet for waste, but in a number of other adjacent sectors. So we quite like that theme where you've built an expertise around an area and then you can mobilise it in the emerging market. That feels just a good thing.

Cameron:

Yeah, I mean, think that's a really good example. And in fact, for those who are involved in the Belgrade Waste PPP Project, that was very much the model that was adopted. And I think the Belgrade project was a really good example of how governments in Eastern Europe, for example, can mobilise the private sector. And there I think the involvement of the IFC, the EIB and EBRD was absolutely critical with those multilateral lenders getting involved, creating a bit of credibility and forcing the government to structure the project properly. And that really enabled a really world-class waste PPP project to be developed and attract some really impressive bidders for that project. And I think that was also, to pick up Andrew's point, that was adapting the UK waste PPP model and, in fact, a lot of the documentation that's been used in the UK. So it was really attracting the best of all worlds in order to develop a project in quite a challenging geographic location.

But that's been really interesting. What I'd like to do is one final question for both of you, and that is, if you've got your crystal balls in front of you, where do you see the waste market in 10 years' time? Are we going to have completely different technical solutions out there? Is it going to be an evolution and we're still going to have some of the older EfW plants operational? What do you see happening?

Andrew, why don't we go to you first?

Andrew:

I know one thing that will still be happening in 10 years, there'll still be waste for all the recycling and moving towards reuse. Ultimately, there will still be residual waste. If the history teaches us anything, it keeps coming and you have to deal with it. So I think we'll still need robust proven technologies. And I think EfW provides that robust proven bankable technology that can deal with that residual waste, which is very variable. And these are highly complex plants. And these plants keep evolving, Cameron. I mean they don't stand still. So traditional technology get more efficient, they get longer outages, they get better at producing more electricity, et cetera.

So there's a journey where the business as usual will evolve. I do think that recycling legislation is coming down the line. The primary legislation has been passed. I think the government has been a little bit slow about turning that into secondary and actually putting frameworks in place, but clearly recycling has an ability to tip up and to increase. We've been a little bit sort of flatlined for the last 10 years, but I think the legislation is in play to change it, and I think it'll be different circumstances. I'm a great believer that there's no one size fits all and collecting food waste might work for some authorities that might not work for others. And I think you've got to let local authorities and commercial sectors figure out what's best for them. And then the technology will evolve, certain technologies will get developed and certain ones.

But as I look at the thing you talked about earlier, the sustainable aviation fuel and these next things potentially coming down the line, I think a sort of warning from history for somebody that speaks with experience of developing new technology, it's never easy and you have to really figure out what problem you're trying to solve. And it's never one thing that makes these projects challenging. And I think as an industry and a sector, we don't share as many battle scars as we probably should do, and we don't maybe learn some lessons about if you come up with incentives to stimulate technology, it can have perverse consequences and ultimately waste is quite an aggressive and difficult material to deal with. And the technology, if we focus just purely on the technology, I think you miss out on about how it fits into the wider sector and the different avenues that it can go down.

But I do feel that this is a great industry. In 10 years' time it'll still be here and it'll be doing some things better and there'll be a lot of room for new technologies and room for new players. But as an industry, I can only see it going from strength to strength. And as we talked about earlier, I think now we've got a core of treatment facilities. We need to get the last bit of tonnage out of landfill and then we can expand on the other add-ons that we can have as an industry. But it's definitely a sector that's going to be here and it's going to be strong and it's a sector that's probably going to become more and more relevant as society evolves and the probably culture that we live in continues.

Cameron:

Thanks, Andrew. I'm sure that will give your shareholders a lot of comfort.

Andrew:

I hope so.

Cameron:

Stef, what about you?

Stefan:

Yeah, I'm not sure I can top that, Cam. The way I think of it is, and sorry, just very quickly touching on that SAF point because I know SAF and waste is often mentioned. I think what I'd love to see on the sustainable aviation fuel side is a universe in which we're taking carbon that we capture from EfW facilities and using that as an input into a SAF facility rather than using waste as an input into a SAF facility because that way to feels to me we're decarbonizing two sectors at the same time, which feels to me like proper optimization.

I think what I'd like to see, and I think we should always remember that waste is ultimately a public health service... Public health service, it's a public service, if I could put it that way. It needs to be treated, it needs to be dealt with. And the fact that we can do so much with something that would otherwise be a real problem if left alone, I think is an incredibly good story. So what I would like to see in the future is something that is an integrated industrial waste complex where you've got both your EfW as your baseline and you're spilling power to the grid and private wire around you and district heating plugged into the industry that you're now supporting together with interesting solutions around the IBA and APCR, carbon capture attached to that, and then some sort of waste to X.

If that means you're squeezing out of every tonne of waste that's produced a fully decarbonized solution that is empowering other industries and sectors, that feels to me like a really good story. And I think if we can aim for that, I'd be very happy. Certainly we'd be very willing to go along and help finance some of that journey.

Cameron:

I think that's a perfect place to stop the discussion. So thanks very much Stef for those thoughts and thanks a lot, Andrew, for your experience and thoughts as well. And hopefully there's a lot of stimulating thoughts for people to take away and build upon. So thanks again for your input today.

Andrew:

Definitely, Cameron. Look, thank you for the opportunity to come and speak and have these conversations. I think as an industry we need to keep talking because it's exciting times and there's lots of opportunities. So, yeah, appreciate having spent this time this afternoon and thanks again for the invitation.

Stefan:

Thanks very much for having us, Cameron. Much appreciated.

Cameron:

Well, thank you for listening to this episode of Ashurst Business Agenda. Now, this episode, as mentioned at the start, is part of our special Powering Change miniseries where we're digging down into the findings of the report, exploring the survey data, and looking at the technologies fueling the future. To find out more about the issues explored in this episode, download our Powering Change Report from the Ashurst website where you can also read the previous reports and explore other interesting articles. The links are in the notes to this podcast. To make sure you don't miss any future podcasts, subscribe to Business Agenda on Apple Podcasts, Spotify, or wherever you get your podcasts. And while you're there, please feel free to leave us a rating and/or review. Thanks very much.