North Sea countries agree to close cross-border value chains

On 3 March 2016 parties from four countries signed the Green Deal for a North Sea Resources Roundabout. The aim is to facilitate the free movement of secondary materials, not through new legislation, but in a bottom-up process of harmonisation. The European Commission is enthusiastic and the Netherlands has another sustainability showpiece.

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First international Green Deal signed

North Sea countries agree to close cross-border value chains

On 3 March 2016 parties from four countries signed the Green Deal for a North Sea Resources Roundabout. The aim is to facilitate the free movement of secondary materials, not through new legislation, but in a bottom-up process of harmonisation. The European Commission is enthusiastic and the Netherlands has another sustainability showpiece.

Author: Michel Robles  Translation: Derek Middleton  ©copyright

The select company gathered at the Sofitel in Brussels consisted of three environment ministers from the Netherlands, Flanders and the United Kingdom, representatives from the French environment department, two economic affairs departments and the European Commission, the chairs of the Confederation of Netherlands Industry and Employers (VNO-NCW) and the Dutch Waste Management Association, and other senior figures from the environment, resources, waste and transport communities.

Breaking down barriers

The reason for the meeting was the signing of the Green Deal for a North Sea Resources Roundabout, or NSRR. The Green Deal is a product of the Smart Regulation for Green Growth programme for facilitating innovation and investment of the Dutch economic affairs and environment ministries. The aim of the NSRR is to remove administrative and policy barriers to the use of secondary materials in the transition to an innovative circular economy. Dutch, Flemish, British and French companies, government authorities and representative organisations will be working to achieve this ‘from the bottom up’.

On 3 March the Netherlands, Flanders, the United Kingdom and France signed the Green Deal for a North Sea Resources Roundabout

Resources Roundabout

Green Deals are popular in the Netherlands. According to the Netherlands Enterprise Agency (RVO) 190 of them have been signed since 2011. But the NSRR is the first of its kind. It is the first time that two wholly Dutch concepts have been brought together in an international context: the Green Deal instrument and the far-sighted concept of the ‘raw materials roundabout’ – a trading hub for secondary raw materials and products without unnecessary administrative obstacles. This innovative approach was the reason for the upbeat atmosphere. Information was exchanged, congratulations given and glasses raised. Sharon Dijksma, the Dutch environment minister, was the relaxed but spirited hostess.

Trash is treasure

The principle of the circular economy is enticing: using recovered materials as raw materials for new products. ‘Trash is treasure’, as Sharon Dijksma said in her welcoming speech. Greenhouse gas emissions are falling and scarce resources are being used more efficiently. To survive, businesses must now exchange ideas and gain experience with closing materials loops. That also means closing cross-border value chains, but in practice this has proved to be an intractable problem. For one thing, the criteria in the EU Waste Shipment Regulation are sometimes interpreted differently by member states.

Cross-border transport

The member states also often employ different criteria on the use of secondary raw materials and recyclates, which means that a raw material in one country may be classified as waste in another. The situation regarding regulatory oversight and enforcement is a similar story. It holds up innovation and the scaling-up of activities and techniques, and can lead to excessive red tape when exporting or importing materials. Baudouin Ska, deputy director of FEBEM-FEGE, the Belgian federation of environmental companies, gives an example: ‘The quickest routes between some places in Belgium go through parts of the Netherlands. But if you want to take those routes – even without stopping at all on the way – for some materials you have to go through a series of formalities that take weeks, first for Belgium and then for the Netherlands.’

Pieter Hofstra, chair of the Dutch Waste Management Association, signs the Green Deal: ‘The initiative which the North Sea countries have taken to streamline waste legislation can benefit other member states as well. We believe in this bottom-up approach.’

Streamlining procedures

The NSRR is not about introducing new rules and regulations. ‘New legislation is often not the answer,’ says Freek van Eijk, the director of green growth consultancy Acceleratio who has been appointed by the Dutch government to facilitate the Green Deal. ‘New EU legislation takes a long time to prepare and adopt. In the meantime, companies are faced with an uneven playing field. Things can be achieved much more quickly by harmonising interpretations of the legislation and streamlining procedures.’ The North Sea countries already have many regulations and contacts in common, and so it makes sense to work together on finding solutions. Germany, Denmark and the other Belgian regions will probably join at a later stage.

Bottom ash, compost and PVC

A Green Deal involves a lot of experimentation. For the time being it has been decided to conduct pilot projects on three waste streams: bottom ash, compost and PVC. Each stream has its own bottlenecks in classification, logistics and enforcement. These bottlenecks will be identified and possible options for resolving them via existing legislation and practices will be investigated. Working group reports will allow other stakeholders to remain informed and successful outcomes will be scaled up for wider use across the North Sea area. The ultimate aim is to deal with ten waste/resource streams within a five year period. Candidates for pilot projects in the short term are electronics and struvite.

Pilot stream 1: bottom ash

Incinerator bottom ash contains many valuable raw materials, including metal residues, which can be recovered by companies like Inashco. The company processes five million tonnes of bottom ash each year. This contains more than 20,000 tonnes of aluminium, 5,000 tonnes of copper, 1,500 tonnes of lead, 2,500 tonnes of zinc, 15 tonnes of silver, 1 tonne of gold and 4.5 million tonnes of minerals. There is a growing international market for these raw materials.

The aim of the Green Deal is not to overhaul the existing waste status of the ash or the relevant legislation: ‘We are perfectly aware that this is a product with risks attached,’ stresses Rogier van de Weijer, director of business development at Inashco. ‘Safety is paramount. What we most want to tackle are the rigid notification procedures for international waste shipments, which take months to complete. First, they create an unlevel playing field compared with companies that process domestic bottom ash. Second, there is need for a more flexible application of various aspects of the notification obligation, such as when the shipper wants to take an unconventional route or if we want to send a shipment of waste abroad for testing, so we don’t have to go through the whole procedure all over again for shipments with exactly the same specifications. Even the current bank guarantee requirements for shipments are terribly rigid.’

Dutch image

Sharon Dijksma: ‘This Green Deal is all about paving the way and removing the obstacles to innovation. Every time member states interpret rules differently – sometimes even in ways that are contradictory – it is a missed opportunity for the environment. I can think of no better way to start the Dutch EU presidency. When I was given the environment portfolio in the Dutch House of Representatives I did not have any real feeling for the waste industry, but I have acquired great respect for what the sector is achieving. This Green Deal is a real boost for the environmental image of the Netherlands. Our national failing is our dependence on fossil fuels, but if we can reduce our carbon emissions by closing materials loops, we will rise up the comparison lists. It will create jobs as well. A recycling society is one with jobs and real growth.’ Henk Kamp, the Dutch economic affairs minister, was not present at the signing, but said later: ‘This agreement will allow Dutch companies in the raw materials and waste management industries to benefit from a growing market.’

Highly practical

The British undersecretary of state at the Department for Environment, Food & Rural Affairs, Rory Stewart, praised the Dutch approach as highly practical, both in content and style. ‘I would like to introduce more of these agreements in the United Kingdom.’ Simon Wilson of the independent British think tank Green Alliance called the Green Deal interesting. ‘Of course, it can’t provide a total solution, but it is certainly something that we could pick up on as well,’ he said. Stewart’s Flemish colleague Joke Schauvliege, minister of the environment, nature and agriculture: ‘Flanders is one of the top recyclers in Europe. We are the proof that a circular economy makes more efficient use of finite resources and creates more and better jobs.’ Her French colleague Ségolène Royale, minister of the environment, energy and marine affairs, welcomed the Green Deal as a possible way of scaling up the use of secondary raw materials and creating lasting jobs in Europe.

Pilot stream 2: compost

Using compost as an agricultural product is still under discussion. Compost does not have end-of-waste status in the Netherlands, but it does in the UK and elsewhere. ‘At the same time the Dutch market for compost and organic waste is becoming saturated,’ says Marc Kapiteijn, CEO of Twence, ‘partly as a consequence of the national manure surplus and partly because of the emergence of several alternatives products. On the other hand, European countries with lower livestock densities are in need of fertilisers.’ The problem is that exports, for example to England, may only go through just a few ports, making the logistics unattractive and unprofitable. The NSRR compost working group will look for solutions within the framework of the existing legislation as well as possibilities for harmonising end-of-waste criteria. Kapteijn: ‘We are also interested in trading internationally in minerals recovered from slurry, which might also fit within this Green Deal.’

Push and pull

Industry is also enthusiastic: ‘The main French driver of the shift to the circular economy is the agreement on carbon emissions made at the COP21 climate conference in Paris,’ explains Thierry Mallet, SUEZ director of innovation, marketing and business performance. ‘Besides strong international push measures, such as the EU target of 65% recycling, we also need substantial pull incentives, such as green public procurement, the inclusion of recycling in the EU Green Label and initiatives like this Green Deal, to bring about a financial level playing field between the use of secondary raw materials and primary materials.’

Pilot stream 3: PVC

Europe already recycles 500,000 tonnes of PVC each year, avoiding 1.25 million tonnes of CO2 emissions in the process. Private parties are attempting to quadruple that figure, which will create an estimated 2,000 to 8,000 jobs. The total potential European materials stream amounts to 100 million tonnes. ‘Together with waste collector and processor Van Werven we want to increase the use of recycled PVC worldwide,’ says Florens Slob, director of business development at Van Gansewinkel. However, old PVC often contains cadmium and lead. Under the EU’s REACH Regulation this means it cannot be given an EU-wide end-of-waste status, which frustrates opportunities for cross-border applications. Moreover, in some quarters there are calls for classifying PVC as a hazardous waste. The PVC working group will investigate the possibilities for specific solutions within the existing legislation. Florens Slob is optimistic: ‘Green Deals like those for concrete, the care sector and sustainable landfill management are generating a positive dynamic. In the care sector, for example, the use of raw materials and recycling are being taken very seriously indeed.’

Voluntary

Although previous domestic Green Deals signed by the DWMA have not yet been concluded, the initial effects are promising, thinks DWMA chair Pieter Hofstra. ‘The practical collaboration creates a framework within which you can help each other with small things and together achieve something extra.’ Employers’ organisation VNO-NCW also signed the Green Deal. VNO-NCW chair Hans de Boer: ‘It is part of our growth and raw materials policy, which of course has employment as its underlying motive. The voluntary nature of the agreement is important. A coalition of the willing is simply better at clearing up ambiguities and differences than a forced marriage. I know that some people are sceptical, but let the results speak for themselves later. It is also good that environmental NGOs are involved, because they will experience how things work in practice.’

Innovation Deals

The initiative will be followed up. EU Commissioner for Research, Science and Innovation, Carlos Moedas, wants to build on the Dutch initiative and introduce comparable EU Innovation Deals later this year, say Director General Robert-Jan Smits (Research and Innovation) and Robert Schröder of Moedas’s cabinet. ‘They will have a narrower scope and focus more on barriers to innovation experienced by businesses as a result of EU legislation. In each case we will look at whether national governments are applying the rules more strictly than necessary, perhaps due to a sense of uncertainty. We will also examine existing legislation to see if it offers the required flexibility.’ Ms Dijksma thinks it can be taken a step further. ‘I’m in favour of a more sweeping and adventurous approach. What is to stop us using Green Deals outside the EU as well?’

Environmental movement: ‘No lock-ins’

Are Green Deals only beneficial for the environment? The Dutch environmental NGO Natuur & Milieu is taking part in the NSRR as a ‘critical conscience’. Director Tjerk Wagenaar: I originally thought up the Green Deal idea along with Bernard Wientjes, who was then chair of the Employers’ organisation VNO-NCW, and Maxime Verhagen, then economic affairs minister. The good thing is that as an NGO you can be an active observer and ask questions like “Is this really sustainable?” This initiative is well intentioned and promising, especially because it is being rolled out internationally. But at the same time we will keep a very critical eye on the process. All three streams involve some form of pollution. Lock-in situations in which contaminants can be passed on unrecorded and distributed via recycling products are unacceptable as far as we are concerned. If that happens, we will withdraw from the process.’

Sharon Dijksma (Dutch environment minister):"This Green Deal is a real boost for the environmental image of the Netherlands."
Hans de Boer (VNO-NCW):"A coalition of the willing is better than a forced marriage."
Rory Stewart (British undersecretary of state for the environment):"I would like to see Green Deals in the United Kingdom."
Joke Schauvliege (Flemish environment minister):"We are the proof that a circular economy makes more efficient use of finite resources and creates more and better jobs."
Thierry Mallet (SUEZ):"Besides strong international push measures we also need substantial pull incentives."
Rogier van de Weijer (Inashco):"We want to tackle the rigid notification procedures for international waste shipments, which take months to complete."
Marc Kapteijn (Twence):"European countries with lower livestock densities are in need of fertilisers."
Henk Kamp (Dutch economic affairs minister):"This agreement will allow Dutch companies in the raw materials and waste management industries to benefit from a growing market."
Florens Slob (Van Gansewinkel):"Green Deals like those for concrete, the care sector and sustainable landfill management are generating a positive dynamic."
Tjerk Wagenaar (Natuur & Milieu):"This initiative is well intentioned and promising."

Vision DWMA

The Dutch Waste Management Association expects this Green Deal will boost the European market for secondary raw materials and so stimulate green growth. The initiative which the North Sea countries have taken to streamline waste legislation can benefit other member states as well. We believe in this bottom-up approach.