2011 UK Waste Wood

2011 Briefing Report:
The UK Waste Wood Market

June 2011
Tolvik Consulting Ltd, 2011

UK Waste Wood Market
Issue Number 1
Date 30.06.11
Author APJ/GE
IMPORTANT NOTICE:
This Briefing Note has been prepared in conjunction with:
GE Environmental consultants are experts in the supply,

processing, marketing and commercial support for waste wood
and compost. We have a number of clients from waste
management companies to large scale biomass plants.
Contact details: guy@geenvironmental.co.uk, website
www.geenvironmental.co.uk.
This report has been prepared by Tolvik Consulting Ltd on an independent basis using our knowledge of the
current UK waste market and with reference inter alia to various published reports and studies and to our
own in-house analysis. This knowledge has been built up over time and in the context of our prior work in the
waste industry.
This report has been prepared by Tolvik Consulting Ltd with all reasonable skill, care and diligence as
applicable. We do not warrant the accuracy of information provided. Whilst we have taken reasonable
precautions to check the accuracy of information contained herein, the advice contained within the report is
generic and we would strongly recommend that any assumptions be verified on a project specific basis.
Tolvik Consulting Ltd shall not be responsible for the consequences (whether direct or indirect) of any such
decisions.
Copyright in this document is reserved to ourselves. The report may not be reproduced without prior authority
and due acknowledgement of source.
Tolvik Consulting Ltd, 2011 2

CONTENTS
EXECUTIVE SUMMARY ........................................................................................................................ 4
1. INTRODUCTION ..................................................................................................................... 5
2. LEGISLATIVE AND POLICY FRAMEWORK .......................................................................... 7
3. WASTE WOOD ARISINGS ................................................................................................... 10
4. 2010 DEMAND FOR WASTE WOOD ................................................................................... 15
5. FUTURE SUPPLY VS DEMAND .......................................................................................... 20
6. ECONOMICS ......................................................................................................................... 24
7. OUTLOOK ............................................................................................................................. 29
GLOSSARY .......................................................................................................................................... 30

EXECUTIVE SUMMARY
This Briefing Report is an independent assessment of the future for the Waste Wood market
in the UK, particularly in the light of the potential demand for Waste Wood as a biomass
feedstock for the generation of renewable energy.
In 2009 WRAP produced a report (WRAP Report) which identified the total Waste Wood
arisings in the UK to be 4.6Mt. The general view is that the WRAP Report under-estimated
tonnages in the Local Authority Collected Waste (previously municipal waste) stream by circa
0.5Mt suggesting baseline Waste Wood tonnages in 2007 of 5.1Mt.
This Briefing Report updates the WRAP Report and estimates Waste Wood arisings in 2010
to be 4.3Mt the reduction being a combination of the effects of the recession (which has
particularly affected the construction and demolition markets) and through improved
resource efficiency.
Data from the Wood Recyclers Association (WRA) shows that in 2010 demand for Waste
Wood was 2.8Mt up from 2.3Mt in 2009 largely due to a surge in exports to 0.5Mt. Tolvik
estimates that the WRA report under-estimates demand by circa 0.4Mt making a total of
3.2Mt of Waste Wood demand and that consequently the recovery rate for Waste Wood in
the UK is 74%. It is therefore estimated that a maximum of 1.1Mt of Waste Wood went to
landfill or some other informal outlets.
Projecting forward supply and demand, and assuming a maximum recovery rate of 85%
(marginally above the current rate for Germany and reflecting the practical constraints to
recovery operations), it is estimated that by 2015 a further 0.5Mt of Waste Wood could be
recovered, resulting in 1.6Mt of Waste Wood available for the biomass market.
With current biomass facilities and those already under construction expected to have a
Waste Wood demand totalling circa 1.1Mt, it is projected that by 2015 there will be only 0.5Mt
of Waste Wood available as a feedstock to support new biomass facilities. This is in the
context of the over 20Mt of identified biomass projects in the UK which plan to use wood of all
types (UK and import, virgin and recovered waste) as a feedstock.
Clearly it would take only a small proportion of these biomass facilities to be developed for the
market to move and value of Waste Wood rise further. Whether a Waste Wood feedstock
is then commercially viable will in part be dependent on future wholesale electricity prices and
the ability to secure ROCs long term.
To date discussions regarding the grandfathering of ROC eligibility (which have not fully
resolved the issue) combined with concerns, inter alia, over the availability of both debt and
feedstock have stalled the development of biomass capacity in the UK with only two new
large scale facilities currently under construction (Dalkia Chilton and RWE Markinch).
However, significant biomass capacity is already operational in northern Europe and
seemingly able to support Waste Wood prices which, even after allowing for transport costs,
are competitive with domestic UK markets, particular to the south or proximate to export
locations. With the pressure to reduce reliance on fossil fuels (and in the case of Germany,
nuclear energy) demand for biomass feedstocks going forward in these countries is likely to
remain strong.
There is therefore the very real chance that exports, rather than being a relatively short
term solution, could become a long term market for Waste Wood and that market
participants will need to carefully consider the implications of this trend on their own business
model.

1. INTRODUCTION
1.1. Background
Much has been written about the Waste Wood market over the last few years, and its future role as a
source of biomass for renewable energy recovery. As a result there is the potential for significant
competition between this emerging renewable energy market and existing, established markets for
Waste Wood particularly the panel board industry.
The hope of some has been that this competition for feedstock will stimulate the recovery of additional
tonnages of Waste Wood, so both supporting the development of renewable power and at the same
time contributing to the UKs landfill diversion targets. However others have cautioned that there is
only a limited supply of Waste Wood arisings and enhanced competition could adversely impact on
existing Waste Wood markets.
This Briefing Report first considers, given efforts to improve resource efficiency throughout the wood
supply chain, the scope to recover additional tonnages of Waste Wood in the UK. It then
independently assesses, in light of the increasing demand for Waste Wood in the UK and northern
Europe (particularly as a source of biomass for energy production), the potential implications for the
market.
In this report biomass is shorthand for the use of Waste Wood for renewable energy recovery.
1.2. Scope
This Briefing Report is focussed upon the UK market for post-consumer Waste Wood Grades A-C as
defined in the Wood Recyclers Association (WRA) Grading Structure1.
Grade Typical Sources of Typical Materials Typical Non-Wood Content

Raw Material Prior to Processing
Grade A Distribution. Retailing. Solid softwood and hardwood. Nails and metal fixings.
Clean Packaging. Packaging waste, scrap pallets, Minor amounts of paint, and
Recycled Secondary packing cases, and cable drums. surface coatings.
Wood Manufacture e.g.
joinery. Pallet Process off-cuts from manufacture
Reclamation of untreated products.
Grade B As Grade A, plus May contain up to 60% Grade A Nails and metal fixings. Some
Industrial construction and material as above, plus building paints, plastics, glass, grit,
Feedstock demolition operations and demolition materials and coatings, binders and glues.
Grade and Transfer domestic furniture made from Limits on treated or coated
Stations. solid wood. materials as defined by Waste
Incineration Directive
Grade C All above plus All of the above plus fencing Nails and metal fixings.
Fuel Grade Municipal Collections, products, flat pack furniture made Paints coatings and glues,
Recycling Centres from board products and DIY paper, plastics and rubber,
Transfer Stations And materials High content of panel glass, grit.
Civic Amenity products such as chipboard, MDF,
Recycling sites plywood, OSB and fibreboard. Coated and treated timber (non
CCA or creosote).
Grade D All of the above plus Fencing Transmission Poles Copper / Chrome / Arsenic
Hazardous fencing, trackwork Railway sleepers preservation Treatments
Waste and transmission pole Creosote
contractors. Cooling towers
Table 1: Grades of Waste Wood Source: WRA

The Report excludes Waste Wood arising from forestry residues, green waste, composted products
and sawmill co-products which operate as separate markets alongside the Waste Wood market.
1.3. Approach
Section 2 considers the key policy and legislative drivers for the Waste Wood market.
Section 3 updates the findings of the comprehensive review of Waste Wood arisings prepared by
WRAP which was published in 2009 and was based on 2007 data. In Section 4 these arisings are
compared with current demand in order to estimate the current recovery rate for Waste Wood in the
UK and the tonnages of Waste Wood which continue to be landfilled.
Section 5 projects potential levels of Waste Wood arisings, future recovery rates and considers the
overall supply/demand balance, bearing in mind the potential demand from the biomass sector.
Section 6 then highlights some of the potential economic implications in terms of the future value of
Waste Wood and Section 7 looks at the effects of recent trends on different market players.
1.4. About Tolvik
Tolvik Consulting is a specialist provider of independent, market analysis and commercial advisory
services across the waste sector. Our clients include the UKs leading waste companies, project
finance lenders, independent developers and equity finance providers. As a specialist consultancy,
we have a unique understanding of the waste markets and monitor them closely, maintaining regular
dialogue with the major players in the sector from waste companies and local authorities, through to
regulators, funders and policy makers.

2. LEGISLATIVE AND POLICY FRAMEWORK
2.1. Waste Wood as a Waste
The Waste Wood falling within the scope of this Briefing Report is regarded as a waste under the UK
Waste Management Regulations.
The EA has recently issued for consultation a draft end of waste criteria (Quality Protocol QP) for
the production and use of products from processed Waste Wood. Whilst such end of waste criteria
has the potential to be beneficial at least in terms of the perception of products derived from Waste
Wood, as the Technical Advisory Group to the consultation observed, it is unlikely that of its own it will
effect a change in the overall level of Waste Wood recovery or in the actual tonnages destined for
each end use.
As drafted, the QP will only apply to the use of Waste Wood in panel board manufacture and for
landscaping. It does not apply to the use of Waste Wood as a biomass or for animal bedding,
although it has been reported that the EA are hopeful that biomass use could eventually fall within
the scope of the QP.
For the biomass sector, the development of a QP has the potential to result in a mismatch between
the QP and the requirements of the Waste Incineration Directive (WID).
The incineration of all waste in the UK falls within the scope of WID unless subject to a specific
exclusion. One such exclusion is Waste Wood provided that it does not contain halogenated organic
compounds or heavy metals as a result of treatment with wood preservatives or coating and if it does
not originate from construction or demolition waste i.e. if it is Grade A Waste Wood.
If the QP is developed to include the biomass market and aligns itself with the exclusion under WID,
then the extension of the QP to the biomass sector would be unlikely to have any material impact on
the industry. If however the QP is wider in scope than WID (so that a biomass feedstock ceases to be
subject to WID) then this could impact on the need for facilities to be WID compliant. If narrower, then
the QP would be of no value. Either way, the development of the QP has the potential to result in
market uncertainty.
2.2. Landfill Bans
The recent Waste Policy Review for England stated that in 2012 the Government would consult on
introducing a restriction on the landfilling of Waste Wood with the aim of diverting the still substantial
tonnages that end up in landfill.2
In Scotland, there is an ongoing consultation on landfill bans as part of the role out of their Zero
Waste Plan. Waste Wood is not within the specific source segregated materials which have been
identified, but is likely to be captured within the wider aims to reduce the volume of biodegradable
waste to landfill. Given the Scottish Governments focus on recycling and the waste hierarchy, it is
likely that there will be pressures for higher grades of Waste Wood to be directed to non biomass
uses (i.e. recycling) whilst for more contaminated Waste Wood (where recycling is not possible),
biomass incineration (i.e. recovery) would appear to be the preferred option. Whether this limits the
ability of biomass sector in Scotland to access Grade A Waste Wood remains to be seen.
In Wales too there are plans to develop landfill bans with Waste Wood identified as being one of the
materials with the greatest impact on the carbon footprint. As a result, the expectation is that Waste
Wood will be included within the list of materials which may be banned from landfill in due course.

The extent to which such landfill bans impact on the UK Waste Wood market will be a function of the
tonnages of Waste Wood currently sent to landfill. This is discussed further in Section 4.7.
2.3. Renewable Obligation Certificates (ROCs)
Under the current Renewable Obligation banding, dedicated biomass projects using conventional
technology (i.e. not gasification/pyrolysis) are eligible to receive 1.5 ROCs per MWh of energy they
produce and, following a consultation process in July 2010, DECC confirmed that this level of support
would be grandfathered (i.e. remain with an individual facility) for plants built before April 2013. It
also confirmed that existing facilities would not be up-banded (i.e. have an entitlement to a higher
level of ROCs) should the support levels for new dedicated biomass plant increase at future banding
reviews.
Whilst further clarity regarding post 2013 is expected in the near future, until such time, it will be
challenging for developers to start construction of new facilities, given that they are unlikely to be
commissioned prior to the grandfathering deadline. As a result the development activity is being
slowed down and new capacity is likely to be limited in the short term to those currently under
construction and the modification of existing capacity/co-incineration.
In order to qualify as a biomass energy project, it is necessary to use feedstock from a renewable fuel
source where the biomass energy content is greater than 90%. Whilst the poorest quality lowest
grades Waste Wood may have a biomass energy content as low as 80%, in practice operators are
likely to assume that they can blend various sources of Waste Wood so as to ensure that the
minimum biomass content (and hence ROC eligibility) is achieved.
The value of ROCs is discussed in Section 6.2.
2.4. Packaging Recovery Notes (PRN)s
PRNs (and the export equivalent, PERNs) provide evidence that materials (including Waste Wood)
from packaging have been recycled into a new product. PRNs are issued by accredited reprocessors
when they have recovered and recycled material and the accredited reprocessor can sell the PRN to
obligated companies or Compliance Schemes who use the PRN to prove that the material on their
behalf, or their members behalf has been recycled.
The PRN system was designed to help stimulate the development of recycling capacity but with Wood
PRN values as low as 1-2/t they currently have limited impact on the market; given that the 2011/12
targets set at the same level as 2010 there is little likelihood of these values rising in the short term.
It is therefore reasonable to assume that PRNs will not act as a stimulus to greater recovery of Waste
Wood.
2.5. Export and Import of Waste Wood
The export of Waste Wood, as a waste, is subject to EU Waste Shipment Regulations 1013/2006
(WSR). In practice under WSR the export (and import) of wastes from and to the UK within the EU
fall into one of three categories:
Green List for wastes considered low risk to the environment falling within the defined
'Green List' (largely recyclables), there are lower level controls with no requirement for prior
approval or notification by the relevant authorities;

Recovery for other forms of waste (i.e. not on the Green List) which are to be recovered,
there is a requirement for prior notification (generally on an annual basis) to the relevant
authorities supported by documentation to validate the recovery route e.g. guarantees,
evidence of contract. Technically the relevant authorities do not approve such exports, rather
they will not object.
Disposal export is generally not permitted other than in specific, exceptional circumstances
in accordance with the relevant Waste Management Plan for each member state.
Waste Wood is not on the Green List, therefore its export is only possible if it is recovered.
Whilst Waste Wood remains a waste (and so needs to be transported in the UK by the holder of a
Waste Carriers Licence), Waste Wood storage operations at ports are regarded by the Environment
Agency as a low waste risk activity.
As a result, recent EA guidance is such that an environmental permit is not required for storage prior
to export or after import of up to 8,000 tonnes at any one time of waste woodchip at a dockside in a
sealed container or on an impermeable pavement with sealed drainage for the purposes of recovery
provided that the Wood is stored for no longer than 3 months. This significantly reduces the regulatory
burden on Waste Wood exporters and should allow the export of Waste Wood through most UK ports
(potentially alongside non-waste exports).

3. WASTE WOOD ARISINGS
3.1. The Supply Chain
Figure 1: Waste Wood Routes to Market Source: WRA
Figure 2, prepared by WRA, summarises Waste Wood supply chain.
3.2. Comparison with the WRAP Report
The widely accepted Waste Wood Market Summary Report issued by WRAP in August 2009
(WRAP Report) is used as the benchmark data source for this Briefing Report. The WRAP Report,
using 2007 data, identified the total potential tonnage of Waste Wood in the UK to be 4.6Mt - which
was a significant downward revision on previous estimates.
However, consistent with AEAs recent report for DECC (AEA Report) 3 and the EAs Impact
Assessment of a Quality Protocol for Waste Wood (EA Report)4, Tolvik is of the view that the WRAP
Report under-estimated the tonnages of Waste Wood in the Local Authority Collected Waste (LACW -
previously municipal) stream by circa 0.5Mt which would suggest baseline Waste Wood tonnages in
2007 of 5.1Mt.
In updating these figures to a revised baseline for 2010, two factors have come into play consistent
with the trends in the wider waste market - the impact of the recession and the effects of improved
supply chain resource efficiency.
These are estimated to have had the net effect of reducing the potential supply of Waste Wood by
15% to 4.3Mt in 2010 as shown in Table 2.
This suggests Wood arisings of 72kg per capita for the UK. To draw a European comparison, recent
figures suggest that in Germany the equivalent figure is 80kg per capita with a marginally lower figure
for the Netherlands of 78kg per capita.

WRAP 2007 2010 Updated

Source of Waste Wood % Change
Report ktpa ktpa
Packaging/Commercial 1,169 998 (15)%
Industrial 463 393 (15)%
Construction 1,184 854 (28)%
Demolition 1,138 1,068 (6)%
LACW 619
1,015 (15)%
Adjusted LACW 491
Total 5,064 4,327 (15)%
Table 2: 2010 Baseline Waste Wood Tonnages Source: WRAP/Tolvik Analysis
3.3. Packaging/Commercial
As in the WRAP Report, data on the volume of packaging Waste Wood has been taken from the
National Packaging Waste Database (NPWD) published by the Environmental Agency. For 2010 it is
reported that Waste Wood from the packaging supply chain was 911ktpa in 2010, down 15% on 2007
- reflecting general economic trends.
This figure excludes Waste Wood arising from packaging manufacturing in the UK which WRAP
estimated to be 120ktpa.
According to PRODCOM5 UK pallet production in 2009 was 55.9 million units down from a high of
77.8 million units in 2007. Demand for pallets is driven largely by the manufacturing, wholesale
distribution and retail distribution industries and some measure of recovery compared to 2009 is
expected to have been seen in 2010. The estimated Waste Wood from pallet manufacture has
therefore been reduced to 87ktpa to reflect these trends.
The EA Report highlights the absence of non-packaging commercial waste e.g. discarded office
furniture. In Tolviks opinion the tonnages are likely to be not material to the overall analysis.
3.4. Industrial
Industrial Waste Wood comes from the manufacture of furniture, joinery products, mouldings and
fencing and the WRAP Report estimated 463ktpa of Waste Wood on the basis of 15% wastage on
5Mt consumed.
There have been mixed trends in these industrial sources; on the one hand according to FIRA6, the
latest data on furniture manufacturing in the UK shows that in 2009 output was down 28% on 2008;
on the other softwood deliveries to fencing manufacturers in 2010 were up by 18% compared 2007
reflecting stronger outdoor markets.
However, with rising timber prices, there has been a focus upon greater resource efficiency across
the sectors. For example, in the joinery market7, a recent Resource Efficiency Action Plan (REAP)
identified that waste rates could sometimes be as high as 50%.
Detailed activity statistics are not available but given activity trends and resource efficiency in other
sectors, it does not seem unreasonable that Waste Wood volumes arising from industrial activities are
likely in 2010 to have been circa 15% below 2007 levels, i.e. 393ktpa.

3.5. Construction and Demolition
According to the latest ONS data8, construction activity in 2010 (in constant 2005 prices) was down by
6.1% on 2007 but showed some improvement on 2009.
UK Construction Output 2005 Prices

bn
110
105
100
95
90
85
2007 2008 2009 2010
Figure 2: UK Annual Construction Output Source: ONS
In addition to reduced activity levels, there are clear pressures within the construction industry to
improve resource efficiency. About a quarter of the industry are reported to have signed up to
WRAPs Halving Waste to Landfill voluntary commitment the aim being to reduce all CD&E
(construction, demolition and excavation) waste to landfill by 50% by 2012 when compared to a
2008/9 baseline. Its recent signatory report9 showed that the fall in participants tonnages to landfill in
2009, after stripping out the effects of the recession, was the equivalent to a landfill reduction of 44%.
This was achieved through a combination of increased recycling and greater resource efficiency.
Clearly whilst increased recycling results in greater tonnages of Waste Wood coming into the market,
the focus on resource efficiency will have adverse impact on levels of supply. The report also
highlighted a reduction in overall waste arisings between 2008 and 2009 from 643t per 1m spend to
494t per 1m spend i.e. a resource efficiency improvement of 23%.
In this Briefing Report it has been assumed that this efficiency improvement will apply equally across
all material streams. When combined with the lower overall level of construction activity, the impact on
the potential availability of Waste Wood from construction is significant a compound reduction
between 2007 and 2010 estimated to have been 28% to 854ktpa.
Consistent with the assumptions in the WRAP Report, it is reasonable to assume that the level of
demolition activity followed that for construction; but, unlike construction, there has been no improved
resource efficiency as the level of Waste Wood arisings is not within the control of the demolition
contractor.
3.6. Local Authority Collected Waste (LACW)
Analysis of data from Wastedataflow for 2009/10 shows that Waste Wood recovered at HWRCs in
England and Wales was 602ktpa up from an equivalent of 561ktpa in the WRAP Report. Further,
limited, Waste Wood tonnages were collected through the recycling of specific LACW streams

particularly bulky waste. However, such figures reflect the captured Waste Wood but not its
availability in the total LACW waste stream as evidenced by detailed, but dated, LACW composition
data10 which estimated wood to represent 3.7% of the total LACW stream.
Sources of LACW Waste

Wood
HWRC
Kerbside
Non household
Residual
Other
Figure 3: LACW Waste Wood Source: Resource Futures
Assuming this composition analysis continues to apply, given that in 2010 LACW totalled 31.6Mt, the
total tonnage of Waste Wood in the UK LACW stream is estimated to have been 1.18Mt. However, in
Tolviks opinion, it is likely that this figure double counts some Waste Wood from other sources
particularly given rising disposal costs which potentially encourages low quality Waste Wood to enter
the free LACW chain.
For this Briefing Report it has been assumed that 5% of Waste Wood from non-domestic sources
finds its way into the LACW stream and the tonnages of Waste Wood in the LACW stream have
revised downwards accordingly.
3.7. Seasonality of Arisings
ktpa 2010 Waste Wood Arisings by Quarter

1,400
1,200
1,000
LACW
800
Demolition
600 Construction
Industrial
400
Packaging
200
0
Q1 Q2 Q3 Q4
Figure 4: Waste Wood Arisings by Quarter Source: Tolvik Analysis

Waste Wood arisings are seasonal, with construction and demolition activity, together with DIY (which
drives Waste Wood arisings within the LACW stream) all higher in the summer than winter months.
There is more limited seasonality for the packaging stream. Figure 4 demonstrates this seasonality
although it should be noted that the nature of the data sources, being on a quarterly basis are such
that it under-estimates the seasonality effect.

4. 2010 DEMAND FOR WASTE WOOD
4.1. Overview
The only source of data on Waste Wood demand is the annual WRA annual statistical release11. For
2010 this estimated a total demand (including a significant increase in exports over 2009), of 2.8Mt.
Mt Uses of Recovered Waste Wood

3.0
2.5
2.0
Export
1.5 Biomass
Agricult/Hort
1.0
Panelboard
0.5
0.0
2007 2008 2009 2010
Figure 5: Uses of Waste Wood Source: WRA
This Briefing Report has used this analysis for 2010 but has also includes estimates of the potential
demand from other outlets, specifically informal Waste Wood uses, which are not included in the
WRA statistics.
Assuming that there were no material imports of Waste Wood during 2010, it is estimated that 3.2Mt
of Waste Wood was recovered, the equivalent to an overall recovery rate for Waste Wood of about
74%.
Tolvik 2010
Waste Wood End Market kt WRA 2010
Estimate
Panel board 1,119 1,119
Bedding* 391 500
Equine 77 75
Mulches* 95 150
Pathways 17 17
Biomass Energy 551 551
Informal Commercial* 100
Informal Domestic* 150
Exports 540 540
Total 2,790 3,202
Table 3: End Markets for Waste Wood 2010
By way of comparison, using WRAP arisings data, a recent report from Scotland12 the estimated
recovery rate for Scotland at 306ktpa/365kpta, or 83%. With significant panel board manufacturing

capacity in Scotland, together with one of only three currently large scale biomass facilities accepting
Waste Wood (see Figure 6), the Waste Wood supply chain is well developed in Scotland and it is
perhaps not surprising that its recovery rate is higher than the rest of the UK.
Panel board
Large Scale Biomass

using Waste Wood
Figure 6: UK Waste Wood Demand Panel board & Biomass Source: WPIF/Tolvik
From an international perspective it is estimated that the current recovery rate in Germany is about
80%13.
4.2. Panel board Demand
The panel board industry remains the largest single user of Waste Wood in the UK, and historical
levels of demand for Waste Wood from this sector have been tied to trends in the construction
industry.
In 2009 production levels dropped to a long term low but 2010 data from Wood Panel Industry
Federation (WPIF) confirms a 5% recovery in 2010, broadly consistent with the overall trends seen in
the construction industry (Figure 2).
4.3. Agricultural/Horticultural Demand
Animal bedding which generally uses Grade A Waste Wood, is the largest single element of demand
for Waste Wood under the broad agricultural/horticultural category.
Demand has been rising steadily over the last few years influenced by a number of factors including
economic conditions, seasonality and availability of alternatives (straw, shavings etc) and with pricing
determined by alternatives rather than the Waste Wood market. According to WRA data, 2010 saw a
further 8% increase in activity over 2009.

Tolviks demand figures also seek to reflect that, alongside the established reputable suppliers of
animal bedding, there is a parallel market, using lower grade material, currently attracted to the
market.
WRA estimates that 95ktpa of Waste Wood used in mulching and composting. However as WRA
recognises there are hundreds of very small wood processing companies which operate with a
simple chipping machine, often combining wood processing with composting, with markets assumed
to be farmers. Wastedataflow shows in 2009/10 over 50ktpa of LACW Waste Wood was composted.
Given that LACW represents less than 25% of overall Waste Wood Market, it is probable that the
WRA figure under-estimates the tonnage of Waste Wood which is composted particularly in those
sections of the market where the focus of the operator remains landfill diversion rather than the
production of a high quality product. However it is reasonable to assume that this demand will decline
with rising Waste Wood values.
4.4. Existing Biomass Markets
The demand for wood (both virgin and Waste Wood) as a source of biomass for energy production in
the UK has increased significantly over the last few years. Figure 6, which is based on virgin timber
sources alone, clearly highlights this trend.
For Waste Wood, the operational large scale facilities in the UK include SSE Slough Heat and Power,
E-On Lockerbie, UPM, Western Wood Energy and Semcorp Wilton-10 with relatively small tonnages
of Grade A wood pellet also being used in co-incineration.
WRA estimates that Waste Wood demand from such facilities in 2010 was 551ktpa; up 60ktpa from
2009. This is not inconsistent with Tolviks own estimates.
Mt UK Woodfuel Deliveries
1.6
1.4
1.2
1.0
0.8 Hardwood
0.6 Softwood
0.4
0.2
0.0
2006 2007 2008 2009 2010
Figure 7: UK Woodfuel Deliveries to Biomass Markets Source: Forestry Commission
4.5. Informal Recovery
In Tolviks opinion it is likely that the WRA statistics do not fully capture the demand for Waste Wood,
specifically Waste Wood which does not reach the formal supply chain and so is lost from data sets.
These sources of demand include commercial users e.g. small scale on site heat recovery
operations, and domestic markets. With rapidly rising energy costs and rising sales of domestic wood

burners it is highly probable that the informal domestic recovery market has become more significant
over the last few years.
In recognition of this demand, small scale on-site commercial use of Waste Wood has been
assumed in this Report to be a nominal 100ktpa although there is very little evidence to draw any
meaningful estimates particularly given that it is not necessarily in the interests of users to advertise
(the sometimes unregulated) activities.
A recent survey of British Woodworking Federation (BWF) members suggested that as much as 50%
of off-cuts went to staff, local charities or otherwise given away as a fuel source. Whilst it is difficult to
relate this to tonnages nationally, if 10% of all Waste Wood from packaging and industrial activities
were to be diverted in this way would it be the equivalent of 139ktpa.
Looked at another way, sales of domestic wood burners are reported to have recently been more than
150,000 units per annum. Assuming 1 million such units are in operation and if just 5% Waste Wood
is used (for example for kindling) on an average consumption of 3 tonnes per annum consumption,
then this would represent 150ktpa.
4.6. Export
According to preliminary information released by the EA to Tolvik under the Freedom of Information
Act, in 2010 exports of AC130 Treated Cork and Waste Woods amounted to 273kt.
Tolvik notes that this is about half the figure reported by WRA and in the absence of any clear
explanation for the difference, the WRA data has been used in this Briefing Report.
4.7. Seasonality of Demand
Section 3.7 sought to highlight the seasonality of Waste Wood arisings. The demand for Waste Wood
similarly is seasonal, but counter-cyclical to supply with typically higher demand in the winter months
when the availability of virgin wood is generally lower due to access restrictions and high moisture
content and where Waste Wood is attractive as a blend to reduce the overall moisture content.
4.8. Unrecovered Waste Wood
The England Waste Policy Review suggests that substantial tonnages of Waste Wood are landfilled
but the evidence for this is not compelling with the above analysis suggesting a maximum shortfall of
1.1Mt between the 2010 supply of 4.3Mt and the 3.2Mt of recovered Waste Wood.
Tolvik has recently undertaken significant work in analysing Residual Waste tonnages across the
waste industry. In 2010, according to HMRC data, total active (i.e. not inert) Waste landfilled in the UK
was 27Mt. Detailed information is available for LACW and it is estimated that the Waste Wood in the
Residual LACW stream is about 0.35Mt. Most of this Residual Waste is landfilled but up to 20% is
sent to municipal waste incinerators.
The total UK tonnage of active, non-hazardous Residual C&I Waste sent to landfill in 2010 is
estimated to have been 12.4Mt and detailed landfill inputs from 2009 show negligible tonnages of
separately identified Waste Wood being landfilled. Waste Wood is therefore likely to be found, to the
extent it has not already been recovered, in mixed loads. There are no recent composition surveys for
such wastes, the latest14 from 2007 estimated Waste Wood to be 5.2% of the waste stream. A
previous survey by SWAP15 estimated it to be 3.55%. Whilst behaviours have no doubt changed over
time, it is not unreasonable to assume that the pressure to divert Waste Wood from the C&I Waste

stream was the same as for other recyclable elements of the waste stream. Using the mid point of the
data sets i.e. 4.4% suggests a maximum of 0.5Mt of non-LACW Waste Wood as active waste to
landfill.
Whist there should be no Waste Wood in the Inert waste tonnages sent to landfill (which attracts the
lower rate of landfill tax), it is likely that such tonnages this will include small incidental quantities of
Waste Wood (consistent with the HMRC definition of inert for the purposes of establishing landfill tax
liability). With HMRC reporting 11.0Mt of inert waste attracting the lower rate of landfill tax in 2010, it is
not unreasonably to assume up to 0.1Mt of Waste Wood in the overall inert waste stream.
This leaves up to 0.2Mt unaccounted for. It is probable that some of this is low grade material
disposed outside the formal waste supply chain either illegally or without proper consents (including
bonfires and specifically 5th November) although the scale of this figure is impossible to verify.
4.9. Enhancing the Recovery of Waste Wood
Considering the analysis in Section 4.7, it is clear that the scope for enhancing the recovery rates for
Wood Waste is limited; this is unsurprising, for with landfill costs (including landfill tax) during 2010 at
circa 56-72/t and the gate fees for even lowest grades being generally less than 20/t (see Section
6.1), the economic incentive to divert Waste Wood from landfill is now high and the difference (of 30-
50/t) is likely to generally be sufficient to cover the costs to segregate, process and transport Waste
Wood.
Any Waste Wood still going to landfill is likely to be either of very low quality or arises where there are
no local reception points for and where transport economics make recovery unattractive.
In this context, therefore, if an overall recovery rate of 85% is assumed (marginally above that
estimated for Scotland and Germany) then the maximum potential additional supply of Waste Wood,
based on 2010 arisings data, is about 0.5Mt.

5. FUTURE SUPPLY VS DEMAND
5.1. Waste Wood Arisings
Overall the projections outlined below seek to assess the balance between future levels of economic
activity in the UK and the pressure for improved resource efficiency.
Packaging - Volumes are projected to follow GDP16 with 1.7% increase in 2011 and 2.0% in 2012
and beyond; Waste Wood from pallet manufacturing is projected to flat line - with any gains from
increased activity being offset by increased resource efficiency.
Industrial - Waste Wood from industrial activity is projected to flat line - with any gains from increased
activity levels offset by increased resource efficiency.
Construction - In the construction sector, activity is expected to stagnate until at least 2013 as
government cuts begin to bite, construction of the Olympic Park concludes and housing continues to
encounter supply and demand problems. However increased resource efficiency is expected to mean
that Waste Wood volumes continue to fall at a modest 2.5% pa for 3 years although the potential is
for the decline to be significantly greater.
Demolition - Activity levels are projected to follow construction sector.
LACW - Waste Wood arisings are projected to continue to decline with LACW arisings by 1.5% in
2011, flat-line for 2012 and then increased by 0.5% pa thereafter.
Mt Projected Waste Wood Arisings in UK

5.0
4.5
4.0
3.5
LACW
3.0
Demolition
2.5
Construction
2.0
1.5 Industrial
1.0 Packaging
0.5
0.0
2010 2011 2012 2013 2014 2015
Figure 8: Projected Waste Wood Arisings in the UK
Given the recent significant decline in Waste Wood arisings following the recession and the effects of
greater resource efficiency, the combined effects of these projections is for Waste Wood arisings to
level out at about 4.3Mt.
This compares with the EA Report which suggests 4.7Mt of arisings in 2011/12 increasing 1%
annually. In Tolviks opinion the effects of greater resource efficiency are such that sustained growth
in arisings is unlikely.

5.2. Recovered Waste Wood
The EA Report assumes that by 2020/21 the recovery rate for Waste Wood will be 95%, requiring
exceptionally high participation, capture and process efficiency within the supply chain. In Tolviks
opinion this is unachievable and in this Briefing Report it has been assumed that Waste Wood
recovery rates move in a linear fashion towards an 85% recovery rate by 2015.
As a result the tonnages of recovered Waste Wood are projected to rise by 0.5Mt from 3.2Mt to
3.7Mt.
Waste Wood (Mt) 2010 2011 2012 2013 2014 2015

Arisings 4.33 4.29 4.26 4.25 4.27 4.30
Recovery Rate 74% 76% 78% 81% 83% 85%
Recovered 3.2 3.3 3.3 3.4 3.5 3.7
Table 4: Projected Recovered Waste Wood in the UK
5.3. Waste Wood Demand Excluding Export and Biomass
It has been assumed that demand for Waste Wood (excluding export and biomass), stays at 2010
levels except that
Panel board demand follows construction industry trends (although this does not take
into account any long term effects from the fire at Sonae);
There is a decline in the volume used in mulches as it is priced out the market;
Given projected high fuel prices, demand from informal outlets rise at 5% p.a.
Mt Waste Wood Available for Biomass

4.0
3.5
3.0
Available for
2.5 Biomass/Export
2.0
1.5 Non
Biomass/Export
1.0 Demand
0.5
0.0
2010 2011 2012 2013 2014 2015
Figure 9: Projected Waste Wood Available for Biomass and Exports
In practice it is likely that if the value of Waste Wood increases beyond a certain point (see Section 6)
then the various markets will actively seek, as available and suitable, substitution opportunities.
The net effect of these assumptions is a relatively steady projected demand for Waste Wood as
shown shaded purple in Figure 9. The blue shaded area represents the volumes of Waste Wood
available for biomass and export.

Waste Wood (Mt) 2010 2011 2012 2013 2014 2015

Recovered 3.2 3.3 3.3 3.4 3.5 3.7
Demand excluding
(2.1) (2.1) (2.1) (2.1) (2.1) (2.1)
Biomass and Exports
Available for Biomass
1.1 1.1 1.2 1.3 1.4 1.6
and Exports
Table 5: Projected Tonnages of Waste Wood available for Biomass and Exports in the UK
5.4. Waste Wood Demand Export and Biomass
In projecting forward, it has been assumed that the current biomass demand (550ktpa) remains
unaltered i.e. in 2010 such facilities operated at capacity and no switching between fuel feedstocks
will take place in the future. In practice, for multi-fuel facilities and co-incineration facilities, feedstock
switching will take place so as to maximise commercial opportunities (i.e. varying economics from one
sector to another) and operational efficiency (e.g. moisture content, calorific value).
As existing facilities, it has also been assumed that their competitive advantage over new entrants is
sufficient for them to retain their feedstocks.
With respect to future demand there are a significant number of potential projects at various stages of
development which could materially impact on the market. In this context it seems appropriate to
separate out those facilities currently under construction (and which will meet the grandfathering
deadline of April 2013) from those which have yet to start construction.
Those biomass facilities currently under construction with an expected Waste Wood feedstock are:
Dalkia Chilton - 120ktpa WID compliant operational 2011;

RWE Markinch - 400kpta mixed clean and Waste Wood of which 75% expected to
be Waste Wood late 2012;
Small scale - 30ktpa each; notwithstanding the slow rate of development 4 projects
assumed to become fully operational.
This provides a combined maximum Waste Wood demand of 540ktpa. When added to the existing
capacity of 550ktpa, suggests a total biomass demand of 1.1Mtpa; by the end 2012 (see Table 5) the
available tonnage of Waste Wood to support additional biomass facilities would then be just 0.1Mtpa;
this would rise to 0.5Mtpa by 2015 assuming the projected improvement in recovery rates.
Plans for UK biomass facilities identified by the Biomass Energy Centre17 total over 32Mtpa of
capacity and exclude many of the smaller planned biomass facilities although it is almost impossible
to estimate the exact figure as new projects are announced and existing projects fall away all the
time. These planned facilities are based on a wide variety of feedstocks both domestic and imported
with wood being the identified feedstock for over 20Mtpa of capacity.
If it assumed that 10% of demand at each of these wood based facilities is for domestic Waste
Wood, then in 2015 there will be a shortfall in the supply of Waste Wood if just 25% of planned
capacity is developed.
The development of biomass capacity clearly has the potential to have a significant impact on the
overall Waste Wood market.

5.5. Developing Biomass Capacity
As developers are discovering, delivering operational biomass facilities in the UK is challenging with
the planning process but one of a number of barriers. The development of planning consents into
operational facilities is limited by a number of factors including the ability to secure:
adequate tonnages of feedstock either imported or UK domestic and it is worth

noting that some of the larger facilities which focus on import have planning
restrictions which still require the sourcing of some UK domestic biomass inputs;
feedstock at a long term economic price it is reported that some markets are
seeking 100/t for Grade A Waste Wood at which point a biomass project is likely
to become commercially unattractive;
comfort as to the sustainability of legislative context this has particularly been
the case with regards to grandfathering under the ROC regime but may also apply to
other legislative drivers;
adequate financing given that debt market appetite for risk is significantly lower
than before the 2008/9 banking crisis it is likely that only projects with access to
significant equity will be developed;
a robust, viable technology particularly for smaller scale solutions where a
number of projects are understood to be finding reliable long term operational
availability a challenge.
In this context the UK is at a very different stage of development from rest of northern Europe which
has an established biomass industry and potential spare capacity.
5.6. North European Biomass Capacity
The demand for Waste Wood from northern Europe is likely to continue, particularly from Germany.
Germany - the market is unbalanced and is heavily dependent on imports. According to BAV18 the
demand for Waste Wood is currently 7.2-8.7Mt, of which 6.1-7.5Mt is for the 69 facilities accepting
Waste Wood in Germany. Domestic Waste Wood fell by up to 20% as a result of the recession
(compare this with the projection in this Briefing Report for the UK of 15%) and whilst some measure
of recovery has been reported, up to 1Mt of Waste Wood will continue to need to be imported.
With the recent decision in Germany to abandon nuclear power by 2022 it is likely that demand for
Waste Wood as an alternative non nuclear, non fossil fuel feedstock will rise.
Netherlands - with currently only 3 biomass plants requiring 0.5Mt of Waste Wood and a domestic
supply reported to be 1.3Mt, the Netherlands is a net exporter of Waste Wood.
Sweden - With a general incineration over-capacity and a number of facilities with contractual
obligations to supply heat, demand for Waste Wood (and other high CV fuels) is high and according
to information from the Swedish EPA, applications to import Waste Wood from the UK in the first 4
months of 2011 totalled 300ktpa.
As a result of this international pressure, there is a very real possibility that export markets, rather
than being relatively short term as reported will remain an attractive long term outlet.

6. ECONOMICS
6.1. Current Value of Waste Wood
According to letsrecycle.com19, the value of Waste Wood has flattened out over the last 12 months
after a period in which it rose significantly. This flattening out is perhaps not surprising given that the
expected surge in firm development plans for UK biomass facilities failed to materialise as quickly as
may previously have been expected.
The actual value of Waste Wood is a function of four key factors:
Grade and quality

Seasonality
Geography transport costs are a critical factor, particularly given strong demand to the north
of the UK as demonstrated by Figure 7;
Level of pre-processing - the extent to which Waste Wood is pre-processed and fit for
market.
and so, in effect, there is no single value in the market and a key competency for operators in the
market is the ability maximise the value from actively managing products to meet market demands.
Letsrecycle reports unprocessed Grade A Waste Wood currently trading around the 0-5/t mark and
that unprocessed Grades B&C is trading in the 7- 35/t range. These correspond to values
independently indicated to Tolvik but it is understood that, in general, for Grades B&C gate fees are at
the lower end of the range i.e. between 10-15/t although in more remote geographies or where
there is limited competition figures of 20/t+ have been reported.
/t Waste Wood Gate Fees

40
35
30
Grade A
25
20
Grade B&C
15
10
Figure 10: UK Waste Wood Gate Fees Source: Letsrecycle
However, with the recent surge in exports, gate fees are starting to be influenced not just by the UK
supply/demand balance but also by European market values. However, this does depend on
geography.

Panel board
Large Scale Biomass

using Waste Wood
Figure 9: UK Waste Wood Geography
Consider the case of a Waste Wood operator located 100 miles from a southern English port. It is
estimated that to transport Waste Wood a distance of 100 miles (as shown highlighted in Figure 10)
would cost about 10/t. There are several biomass/panel board facility within this range and in theory
the operator would have a choice between UK domestic market and the export market.
Table 6 shows that if the export gate is 35/t (30/t) the net cost of export would be 10/t. For the UK
market, the net cost would be -2.50/t i.e. the UK market looks more attractive. Move 50 miles
closer to the coast, the economics change and export prices are broadly equivalent to UK domestic
prices. For the UK facility to be able to attract Waste Wood from such a location it would therefore
need to increase the value it is willing to pay in the market.
This over-simplistic analysis clearly shows the significance of geography and the way in which export
prices can directly influence UK domestic prices.
Prices /t 100 Miles from Port 50 Miles from Port

UK Market Germany UK Market Germany
Delivered Price (0-150mm) 15 30 15 30
Total Export costs - -20 - -20
20
Screening & Chipping cost -7.50 -10 -7.50 -10
UK Domestic transport costs -10 -10 -12.50 -5
Net UK Cost -2.50 -10 -5 -5
Table 6: Comparative Median Economics for Grade B&C Waste Wood

6.2. Value Drivers
The future underlying value of Waste Wood in the UK will be driven by a complex series of inter-
related factors which will influence the supply/demand balance both in the UK and, increasingly, in
northern Europe. These factors are likely to include:
Future wholesale electricity prices, regulatory pressures and the availability of direct
and indirect subsidies which will determine the ability of new biomass facilities to
economically secure feedstock;
The pricing and availability of substitute feedstocks - including virgin wood for panel
board, straw for animal bedding etc;
The sensitivity of the end markets to product prices particularly for panel board and
animal bedding;
Contractual structures the cost and risks associated with securing feedstock long
term vs short term market opportunities.
It is reasonable to assume that these factors will in turn limit the level to which, in the event of supply
side constraints, the value of Waste Wood could rise. Discussions in the industry suggest that based
on the current economic models a price of 50/t for Class A Waste Wood (or 3/GJ) is likely the
maximum average value achievable on a long term basis; this is not to say that short term pricing
could be higher until demand adjustments, driven by price rises, start to impact.
Wholesale Electricity Prices
In a recent report for DECC21, which assumed a status quo based on current electricity policy, a
steady rise in electricity prices in real terms was projected. A range of alternative scenarios arising
from electricity market reforms all exceeded this baseline in the short term with prices moving towards
80/MWh by 2023. Such increases, if they came to bear, would tend to support a higher value for
Waste Wood than current wholesale prices around the 50/MWh level.
Figure 11: Projected Wholesale Electricity Prices Source: Redpoint for DECC

ROCs
Over the last 5 years the value of ROCs has remained reasonably constant, at around the 45-50
per ROC. The future value of ROCs will be dependent on the ability of the UK to meet its targets, and
given the recent development history for renewables, most commentators suggest that ROCs should
at least stay at or near current values for the foreseeable future.
ROC Values
60.00
50.00
40.00
High
30.00
Low
20.00
10.00
0.00
Figure 12: Historic ROC Values Source: e-ROC.co.uk
ROC values themselves are therefore likely to have less of an impact on the market than the
fundamental question as to whether or not developers (and their funders) can get comfortable with the
future availability of ROCs for their specific project.
Substitute Biomass Feedstocks
Particularly for biomass facilities, there is the opportunity, within consents, to switch tonnages
between different feedstocks. To this extent, the value of Waste Wood will be influenced by the prices
of these other clean biomasses; and this is likely to become more pronounced as markets mature and
the number of trades in the market increases. One of the challenges for the market is the absence of
clear market pricing although a number of specific (clean biomass) indices are now being developed.
For example the PIX Nordic Pellet index which has seen values rise by 16% over the last 4 years
highlighting modest pressure on biomass supplies.
The AEA/Oxford Economics Report2 did not specifically differentiate between these different sources
but suggests that future biomass prices would rise by 2020 by a modest 10% and remain flat
thereafter in real terms. This is because it has been assumed that:
other energy prices and the overall demand for energy are forecast to grow only slowly. In particular,
prices of underlying feedstocks grow more slowly than price inflation as a whole. While this has
generally been the case for the last few decades, this may prove to be an overly conservative
assumption in the future if the demand for this feedstock both for bio-energy and other uses continues
to rise strongly.
It is also worth bearing in mind that some alternative (i.e. non Waste Wood) biomass sources
themselves may compete with other forestry product sectors e.g. paper, timber or agricultural
uses (energy crops).

There has been considerable comment of late that market fundamentals are putting pressure on
timber prices and according to the WPIF the price of standing timber is a reflection of the raw material
prices. Whilst standing timber prices have seen significant increases in price over the past few years22
in nominal terms current levels are not out of line with historical comparisons.
Average Nominal Price - Coniferous

Standing
18.00
16.00
14.00
per m3 Overbark
12.00
10.00
8.00
6.00
4.00
2.00
0.00
Figure 13: Coniferous Standing Nominal Prices Source: Forestry Commission Timber Price Index
End Market Sensitivity
Pressures on feedstock prices will, inevitably, impact on product prices, and the sustainability of future
Waste Wood values will in part be influenced by the willingness of the end markets to pay for more
expensive products rather than either seeking substitute feedstocks or looking to import products
into the UK.
As an example of this sensitivity, in March, Senator, a leading UK furniture manufacturer, reported

that chipboard prices had increased by 30% over last 12 months.
Contractual Requirements
Securing a certain adequate long term feedstock of Waste Wood is a key challenge, particularly for
biomass developers with a fragmented supply chain, the seasonality of supply and the complex
inter-action with competing demands for Waste Wood.
There are a number of potential strategies to overcome these challenges including vertical
integration, long term agreements with major Waste Wood producers (to the extent that such
producers are able to provide the necessary certainty with respect to future supply) and through
engagement with aggregators. In each case, the agreed value of Waste Wood will reflect the extent to
which future market uncertainties have been offset by contractual protection.

7. OUTLOOK
The Waste Wood market is relatively immature and in a state of considerable uncertainty. Whilst it is
not unreasonable to assume that by 2015 the market will have developed into one providing with
greater stability, the roadmap from 2011 is far from clear.
Substitution
WasteWood
RecoveryRate
WasteWood
Supply
WasteWood Transport
Price Costs
Total
Animal Demand Export
Bedding Market
Prices
UKMarket ExportMarket
Panelboard
Demand Demand
UKBiomass
Subsidies
etc
Figure 14 Waste Wood Interdependencies
For the producers of Waste Wood, the economic and environmental imperative is to improve
resource efficiency and reduce overall levels of waste arisings. For any Waste Wood which then
arises, a focus on the segregation at source of Grade A from the other Grades should help to
maximise the value of the waste stream.
For aggregators and processors, the scope for a significant improvement in the recovery rates for
Waste Wood is limited. However, as the Waste Wood market matures, so there are likely to be
opportunities to further optimise supply chains and manage risk and through the production market
specific products to a number of different customers across a number of geographies.
For the panel board industry, although the WPIF is actively defending its corner against the threat
posed by an explosion in biomass facilities in the UK, it also needs to consider whether European
demand is in fact a greater longer term threat to market dynamics.
For potential investors in Waste Wood biomass facilities, provided the not inconsiderable
development hurdles can be overcome and adequate feedstock sourced, it may be possible to create
first mover advantage particularly where market visibility can be created. Getting the correct scale
could prove critical, given that transport economics will have a significant impact on the size of the
catchment area within which Waste Wood is likely to be secured at an acceptable price.
For animal bedding and landscape users, other than those in remote geographies where transport
costs remain prohibitive, the rising value of Waste Wood is likely to mean that a regular reassessment
will be necessary as to whether Waste Wood is the most suitable material to use when compared to
alternatives.

GLOSSARY
BWF British Woodworking Federation
EA Environment Agency
HMRC Her Majestys Revenue and Customs
HWRC Household Waste Recycling Centres (Civic Amenity Sites)
Ktpa 000s of tonnes per annum
LACW Local Authority Collected Waste
MWh Megawatt hour
QP Quality Protocol
ROC Renewable Obligation Certificate
REAP Resource Efficiency Action Plan
WID Waste Incineration Directive
WPIF Wood Panel Industry Association
WRA Wood Recyclers Association
WRAP Waste and Resources Action Programme

1 Grade of Recycled Wood, October 2009 www.co2sense.org.uk
2 Government Review of Waste Policy in England 2011
3 UK and Global Bioenergy Resource Final report, March 2011
4 Draft dated 28 February 2011
5 UNECE Timber Committee September 2010 - UK Timber Market Statement
6 2010 Statistical Digest
7 Joinery: A Resource Efficiency Action Plan 2010 - BWF
8 Output in the construction industry 1st quarter 2011 13 May 2011
9 The Construction Commitments: Halving Waste to Landfill Signatory Report 2011
10 Municipal Waste Composition: A Review of Municipal Waste Component Analyses Future

Resources for DEFRA
11 http://www.letsrecycle.com/news/latest-news/wood/exports-contribute-to-major-growth-in-wood-
recycling
12 Wood Fuel Task Force 2: An Update Report by the Wood Fuel Task Force To Scottish
Ministers - March 2011
13 International Meeting of Wood Recyclers 13. September 2010 Uwe Groll President BAV
14 SLR Consulting (2007) Determination of the Biodegradability of Mixed Industrial & Commercial
Waste Landfilled in Wales.
15 SWAP (2005) Commercial and Industrial Waste in the Yorkshire and Humber Region.
16 HM Treasury Forecasts for the UK economy: a comparison of independent forecasts April 2011
17 Biomass Energy Centre UK Biomass Power Stations Current and Planned
18 International Meeting of Wood Recyclers 13. September 2010 Uwe Groll President BAV
19 http://www.letsrecycle.com/prices/wood
20 Biomass prices in the UK E4tech, January 2010
21 Electricity Market Reform Analysis of policy options A report by Redpoint Energy in association
with Trilemma UK
22 Timber Price Indices - Data to March 2011, Forestry Commission 16 May 2011

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2011 Briefing Report:

The UK Waste Wood Market

Tolvik Consulting Ltd, 2011

This Briefing Note has been prepared in conjunction with:

GE Environmental consultants are experts in the supply,

Tolvik Consulting Ltd, 2011 2

EXECUTIVE SUMMARY ........................................................................................................................ 4

2. LEGISLATIVE AND POLICY FRAMEWORK .......................................................................... 7

3. WASTE WOOD ARISINGS ................................................................................................... 10

4. 2010 DEMAND FOR WASTE WOOD ................................................................................... 15

5. FUTURE SUPPLY VS DEMAND .......................................................................................... 20

Tolvik Consulting Ltd, 2011 3

Tolvik Consulting Ltd, 2011 4

Grade Typical Sources of Typical Materials Typical Non-Wood Content

Table 1: Grades of Waste Wood Source: WRA

Tolvik Consulting Ltd, 2011 5

1.4. About Tolvik

Tolvik Consulting Ltd, 2011 6

2. LEGISLATIVE AND POLICY FRAMEWORK

2.1. Waste Wood as a Waste

2.2. Landfill Bans

Tolvik Consulting Ltd, 2011 7

2.3. Renewable Obligation Certificates (ROCs)

The value of ROCs is discussed in Section 6.2.

2.4. Packaging Recovery Notes (PRN)s

2.5. Export and Import of Waste Wood

Tolvik Consulting Ltd, 2011 8

Tolvik Consulting Ltd, 2011 9

3. WASTE WOOD ARISINGS

3.1. The Supply Chain

Figure 1: Waste Wood Routes to Market Source: WRA

Figure 2, prepared by WRA, summarises Waste Wood supply chain.

3.2. Comparison with the WRAP Report

Tolvik Consulting Ltd, 2011 10

WRAP 2007 2010 Updated

Table 2: 2010 Baseline Waste Wood Tonnages Source: WRAP/Tolvik Analysis

Tolvik Consulting Ltd, 2011 11

3.5. Construction and Demolition

UK Construction Output 2005 Prices

Figure 2: UK Annual Construction Output Source: ONS

3.6. Local Authority Collected Waste (LACW)

Tolvik Consulting Ltd, 2011 12

Sources of LACW Waste

Figure 3: LACW Waste Wood Source: Resource Futures

3.7. Seasonality of Arisings

ktpa 2010 Waste Wood Arisings by Quarter

Figure 4: Waste Wood Arisings by Quarter Source: Tolvik Analysis

Tolvik Consulting Ltd, 2011 13

Tolvik Consulting Ltd, 2011 14

4. 2010 DEMAND FOR WASTE WOOD

Mt Uses of Recovered Waste Wood

Figure 5: Uses of Waste Wood Source: WRA

Table 3: End Markets for Waste Wood 2010

Tolvik Consulting Ltd, 2011 15

Large Scale Biomass

4.2. Panel board Demand

4.3. Agricultural/Horticultural Demand

Tolvik Consulting Ltd, 2011 16

4.4. Existing Biomass Markets

Figure 7: UK Woodfuel Deliveries to Biomass Markets Source: Forestry Commission

4.5. Informal Recovery

Tolvik Consulting Ltd, 2011 17

4.7. Seasonality of Demand

4.8. Unrecovered Waste Wood