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MRA feedback on the draft Northern Territory Circular Economy Strategy 2022-2027

The release of the Circular Economy Strategy 2022-2027 demonstrates the NT Government’s eagerness to use circular economy (CE) to drive the NT economy and jobs.

MRA strongly supports the move toward a Circular Economy which minimises waste generation, designs materials entering the economy for their end of life recycling and maximises reuse and recycling at the end of a product’s first life.

The Northern Territory Circular Economy Draft Strategy 2022-2027 includes:

  1. Modernising the regulatory framework to protect the environment and to create the right
    regulatory settings to grow the circular economy;
  2. Transitioning to a circular economy;
  3. Establishing a circular economy as a contributor to the Territory’s $40 billion by 2030 vision.

Modernising the regulatory framework

The NT’s regulatory reform will include:

  • phasing out and banning Problematic Single Use Plastic by 2025,
  • implementing risk-based licensing
  • introducing a new regulatory framework to manage the environmental impacts, and
  • strengthening laws and policy around storing and disposing of hazardous waste.

MRA supports these initiatives but points out that the regulatory framework needs to do more than
compliance. It needs to set the boundaries for markets to operate to drive the CE.
Regulatory reform should therefore include:

  • Bans on organics to landfill
  • Landfill levies to drive recycling
  • Bans on recyclables to landfill
  • Minimum operating standards for recycling facilities
  • Mandated organics collection from households and businesses

The NT is a signatory to the National Waste Policy Action Plan and its Target of 80% diversion from landfill by 2030. The NT needs to articulate which mechanisms (regulatory, market or educative) it intends to use to achieve those Targets. Not to do so undermines the National Waste Action Plan and the
commitments of the Meeting of Environment Ministers (MEM).

Transitioning to a Circular Economy

MRA supports the NT Strategy which includes:

  • developing CE principals appropriate for the NT
  • understanding the flow of waste to determine waste availability
  • reviewing and developing incentives/programs to encourage demand and local markets that
  • encourage material recovery and reuse
  • developing a CE indicators framework to monitor, record and report the status of transitioning
  • developing a waste levy to incentivise materials recovery and reprocessing, deter landfill waste, and
  • and ensure a revenue stream to support the waste and recycling infrastructure.


MRA supports these initiatives and particularly bringing the NT into alignment with other States on market pricing of landfills. If landfill in the NT remains under-priced (and not subject to a levy) then
interstate transport and arbitrage is likely to follow (as it did in QLD). The only thing preventing that
occurring now is the additional transport costs to the NT. As other State levies increase so too will the
arbitrage opportunities.

The key elements of a CE are the design of products for end of life recycling (which NT has little control over) and end of life reuse/recycling (which NT can strongly influence). Consequently, it is essential that the regulatory and market price settings encourage recycling over landfilling.

Establishing CE as part of the Territory’s $40b 2030 vision

The NT Government will:

  • contribute towards research into the use of recycled materials in construction
  • fund business grants for the commercialisation of new products
  • support projects that enhance material recycling and reuse capacity, and
  • support the job market and the development of new industries.

MRA supports these initiatives and encourages swift market reform action (and not just regulatory
compliance). The key drivers of the Circular Economy and the establishment of new businesses in
recycling are:

  1. the opportunity cost of landfilling with under-priced landfill undermining all recycling
  2. the value of the recycled material
  3. the markets for those recycled products.

With a recycling rate of only 19% compared to the national average of 62%, there is much to do. The most important single initiative will be the landfill levy and creating the market for recyclers to compete for materials currently going to landfill.

MRA therefore supports the CE Strategy and hopes for urgent action by government to reform the market dynamics. This will allow entrepreneurs to enter the market to create profitable recycling businesses that generate wealth and employ people. In this regard it is worth pointing out that recycling employs three times as many people than landfill (in terms of direct jobs) and many more indirect jobs than landfill.



 

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