A dirty big hole in the UK’s circular economy strategy
New research commissioned by Sizzle Innovation as part of the Enrich the Earth campaign has revealed a gaping hole in the UK’s strategy to protect our natural capital and promote the circular economy.
Soil in the UK is estimated to store 10 billion tonnes of carbon: the equivalent of 80 years of annual greenhouse emissions. It is the source of 95% of our food and is our natural capital. With increased flooding and concerns about UK food security, there is growing recognition that greater effort is required to protect the quality of our soil which is currently eroding year on year.
This requirement is understood by government. In December 2023 the Environment, Food and Rural Affairs committee noted that:
‘Human activity is putting the health of our soils at serious risk. It is critically important to course-correct over the coming years to secure our food supply, bolster our natural environment and preserve life on earth’.
The financial cost of not acting is significant, with soil degradation in England and Wales estimated to cost £1.6 billion a year.
Soil health can be improved in several ways, including the application of quality compost which increases organic carbon levels and improves crop yields. Research has shown that repeated application of green waste-derived compost resulted in an increase in soil organic matter of between 20-25% compared to a control group over a nine-year period. It would seem logical that UK policy should seek to maximise the use of compost to boost the health of agricultural soil. This is not happening.
The new research has conservatively estimated that the potential market demand for compost for arable land is 22 million tonnes per annum (Mtpa). The potential demand is 19 million tonnes per annum greater than the current 3 Mtpa of compost that is currently manufactured across all four nations. It is also 16 Mtpa greater than the amount that could be theoretically generated if there was a more supportive policy context.
Digging deeper into the numbers reveals that one reason there is a significant disparity between demand and supply is that government policy has distorted the market. This has resulted in biowaste being used for generating energy via Anaerobic Digestion (AD) at the expense of it building natural capital by improving the quality of soil.
The desire of the UK government to generate low carbon energy is completely understandable and not being questioned. What the research does reveal is that a myopic view has been taken on the potential value and use for biowaste, focussing exclusively on its potential to generate energy rather than its ability to enhance soil quality – with all the associated carbon benefits this yields.
This narrow viewpoint is apparent when looking at the government subsidies that are available. Through the Green Gas Support Scheme, the incentives available for biowaste to the energy sector range from between £33 per tonne to £58 per tonne and are available for up to 15 years. This makes building AD plants attractive and profitable. The only vaguely equivalent government subsidy available for farmers that encourages the use of biowaste for composting is through the Sustainable Farming Incentive, which offers £6 per hectare for actions that improve the soil. Compost is only one way the farmer can chose to deliver soil improvement, but if chosen, a reasonable calculation shows that this would represent an incentive of £0.10 to £0.30 per tonne of biowaste.
As compost is a recognised way of increasing soil organic carbon levels, thereby sequestrating carbon, it would seem reasonable to make payments available equal to those offered through the UK Emissions Trading Scheme Authority. These are currently at £60 - £70 per tonne of carbon dioxide equivalent. This would provide a ‘level playing field’, creating more balanced and sustainable outcomes.
The opportunity cost of failing to do so are significant and could undermine the UK’s ability to grow enough food sustainably to feed citizens. Ultimately the drive for bioenergy and the need to improve agricultural soils must go together. Fundamentally, the biowaste-soil policy links needs reconnecting.
This levelling of the playing field is one of five policy asks called for by the Enrich the Earth partnership seeking to get the maximum environmental value from the UK’s biowaste by promoting a just transition to a more circular economy.