A group of nine councils in Melbourne’s southeast have entered into an agreement that has reduced their waste sent to landfill by 95 per cent.
Waste management is one of the most important services that councils provide and represents a significant portion of the local government budget. In 2019-2020, Victoria’s Auditor-General reported that councils spent $706 million on waste management state-wide.
As the costs of service delivery rise and landfills reach capacity, councils are looking to find alternative waste management processes that can allow them to continue to deliver their vital services within budget, while enabling better environmental outcomes.
Approximately six years ago, a collection of southeast Melbourne councils banded together to set up South East Metropolitan Advanced Waste Processing (SEMAWP), through which they have worked to procure an advanced waste processing alternative to landfill.
The councils that currently form SEMAWP are:
- Bayside City Council
- Cardinia Shire Council
- City of Casey
- City of Greater Dandenong
- Frankston City Council
- Kingston City Council
- Knox City Council
- Whitehorse City Council
- Yarra Ranges Shire Council
In August 2024, these councils entered into an agreement with Maryvale Energy from Waste (EfW) Project Co, a consortium between Veolia Australia and New Zealand, Opal Australian Paper and Masdar Tribe Australia.
Through this agreement SEMAWP will send waste to an advanced waste processing facility in Maryvale in Victoria’s Latrobe Valley.
Council spoke with Bayside City Council CEO and Chair of the SEMAWP Board, Mick Cummins, about the agreement.
Mr Cummins has been the CEO at Bayside Council for six years and entered into the role of Chair of the SEMAWP Board four years ago.
“I became Chair just as we were about to commence the procurement process in earnest,” Mr Cummins said.
“Each of the nine councils has a board representative that represents the various interests across our region, and my role is to herd the cats, if you like. I share the meetings and make sure we’re making progress towards achieving the objectives of the company.
“The nine councils in the southeast of Melbourne represent a combined population of around 1.6 million people, and that’s expected to grow to about 2.3 million people by 2045. This project’s about identifying how we come up with an environmentally responsible alternative for dealing with the waste generated by those 2.3 million people.”
Tackling rising waste generation
Mr Cummins explained that efforts to reach this waste agreement began approximately six years ago, when councils became concerned about the future of their waste management and started looking for a new, secure and environmentally conscious way of delivering this vital service.
“The last landfill in the southeast of Melbourne is due to close towards the end of this decade, and in two, three, maybe four, years’ time there won’t be any new landfills created in the region,” Mr Cummins said.
“So, councils have been talking about, well, what does that mean for us and what are the alternatives to landfill within the southeast?
“Eventually we came to two choices. We either come up with an alternative way of dealing with waste, or we end up shipping all our waste to landfills in the west or the north of Melbourne.”
Mr Cummins said that councils were keen to try and find an alternative way of dealing with their waste.
“Landfills are a pretty primitive way of doing it in this day and age. So, the councils came together with the assistance and financial support of the State Government, to commence a process of trying to identify what are the alternatives out there in the market for the treatment of waste.
“We went through a market sounding exercise initially, and then proceeded to an expression of interest process to narrow down the various options.”
Maryvale Energy from Waste facility
Mr Cummins said that through its procurement process, SEMAWP found that in the post covid world the cost of construction had escalated dramatically.
“That put a fair bit of pressure on the affordability of advanced waste facilities. The cost of construction has escalated quite significantly.”
Mr Cummins said that SEMAWP quickly realised that developing a facility of its own simply wasn’t feasible, which is what drew the company to partner with the already existing facility at Maryvale.
“The benefits of the Maryvale proposal is that it sits on land owned by the opal paper mill, a large industrial complex that is powered predominantly by gas, which is becoming increasingly expensive.
“From the mill operator’s perspective, this was an opportunity to access waste from a cheaper and more reliable source, but also one that reduced their greenhouse gas emissions enormously.
“Co-location was another great benefit, being next to a large industrial complex like this means that not only the energy, but also the heat generated by the treatment of waste can be very efficiently converted to displace that gas and has produced a really affordable outcome for the councils as well.”
Mr Cummins said that one of the primary benefits of the agreement for SEMAWP is a competitive gate fee.
“That gives us price certainty over the 25 years of the contract, especially with landfill costs expected to continue to escalate quite significantly. We’ve locked in a gate fee which is cheaper than the landfill alternative and will become increasingly more affordable compared to landfill as time goes on.
“From an emissions point of view, it’s a significant reduction in the amount of greenhouse gas emissions compared to landfill. The emissions avoided by Council shifting to this process is about 270,000t of greenhouse gas emissions per annum, more than 50 per cent of the greenhouse gas emissions currently coming from landfill.”
Wrangling nine councils
Mr Cummins said that each council is responsible for ensuring that it is comfortable with the agreement arrangements and that it has calculated the waste volume that it will send to the facility.
“The partnerships are relatively straightforward in that sense, because everyone’s got a seat at the board and it all comes together reasonably simply.
“Having said that, trying to get nine councils to agree on anything can be an interesting exercise in itself. That has been one of the challenges of the partnership. Through the procurement process, we started with 16 councils. A number of those councils pulled out for various reasons.”
Mr Cummins said that his advice to councils seeking to become part of a similar arrangement would be not to underestimate the complexity of dealing with a large number of councils, and the time they can take to work through their various views and cooperate.
“That’s one of the other lessons that we’ve taken away from this, that working with multiple councils on a very large project like this takes time. It can be complex and there’s a fair bit of cost that goes into a procurement process such as this, and it’s important to just be conscious of the time that it can take to massage the various views of all the different councils. It takes longer than it should, but it’s a fact that you have to take into account.
“I also think that early engagement with the State Government and its agencies can really assist with the approvals process.
“In our situation, we were able to negotiate with the Victorian Government to fund much of this procurement so that took away a large part of the cost problem that the councils might have had to deal with otherwise.”
Mr Cummins said that the nine councils make up a very substantial part of Melbourne and that, in their view, the State Government needed to step up and play a role in solving the waste management problem.
“We were able to negotiate a really good outcome and great cooperation from the government in this process.
“You need all the support you can get. Your average council or even group of councils is just not set up for a facility that can be $800 million to $1 billion, it’s just not the normal work of a council. So, making sure you’ve got really good support and government buy-in is really important.”
SEMAWP expects the facility to be commissioned in 2029 and looks forward to certainty of access to waste disposal services and better environmental outcomes for all involved councils for the next 25 years.
