European Union (EU) Landfill Directive

A Directive announced in 1999 requiring all Member States to reduce the amount of biodegradable municipal waste (BMW) sent to landfill.

Biodegradable Municipal Waste (BMW)

Municipal waste includes all waste from households, as well as other waste, which, because of its nature or composition, is similar to waste from households. Around 70 per cent is thought to be biodegradable although the precise figure is not known.

The Landfill Allowance Trading Scheme (LATS)

Introduced in April 2005, LATS sets gradually reducing individual allowances for all disposal local authorities for the amount of biodegradable municipal waste that can be landfilled each year. If met, the allowances will collectively fulfil the Landfill Directive requirements. Individual local authorities may have surplus landfill capacity which can be traded to other waste disposal authorities.

Landfill Tax

Introduced from October 1996 to encourage more sustainable waste management by local authorities and divert waste from landfill. Landfill tax was introduced at two rates: a standard rate for active waste (substances that either decay or contaminate land, which includes household waste) at £7 a tonne; and a lower rate for inert materials at £2 a tonne.8 The rate of landfill tax has increased in recent years and the Government has announced further increases until at least 2010-11. Landfill tax receipts have risen from £333 million in 1998-99 to £877 million in 2007-2008.

Private Finance Initiative (PFI)

A way of funding major capital investments in which private consortia are contracted to design, finance, build and operate projects. Most waste PFI projects last for around 25 years.

PFI Credits

PFI credits represent a promise to pay a PFI grant upon approval by the Department and by the cross-Department Project Review Group and completion of procurement.

Waste treatment facilities

Waste treatment facilities such as mechanical biological treatment plants or energy from waste plants treat waste to convert it into a usable material such as fuel, and to recover energy. Different types of technology are available. Since 2006 the Department has stated a preference for PFI contracts that are for these types of facilities only.

Integrated waste management contract

'Integrated' PFI waste projects include construction and operation of recycling, materials reclamation and composting facilities as well as waste treatment facilities. A small number of contracts also include collection of waste and other environmental services such as street cleansing. Most PFI contracts signed to date are integrated contracts.