Politically incorrect

Written by: Geraldine Faulkner | Published:

SUEZ recycling and recovery UK CEO David Palmer-Jones lets rip on the danger of Brexit (as well as the problems the EU has created), the volatility of the commodity market – and the world at large – and uncertainty about how the sector will cope ‘post-landfill’. By Geraldine Faulkner

Like US president Abraham Lincoln, who was nicknamed ‘Honest Abe’ because he once said “I cannot tell a lie”, David Palmer-Jones, chief executive officer of SUEZ’s UK recycling and recovery division, admits from the start: “I can’t do politically correct.” This ensures he is always a popular speaker at industry events, such as the recent 12th International Energy from Waste Conference, because with Palmer-Jones, you know he shoots from the hip and will always give an honest opinion.

When asked how he would describe the current state of the waste management industry, he responds instantly: “It is in a hiatus between two periods of progress.”

The first period, according to Palmer-Jones, was built up on market drivers, with the landfill tax being a classic behavioural instrument. When the tax was increased to over £40 a tonne, it started to act as a serious deterrent for local authorities to send biodegradable waste to landfill.

“The landfill allowance trading scheme, better known as LATS, brought in huge penalties and was also a tremendous driver in diverting biodegradable waste from landfill,” recalls the CEO. “Incentives such as these have been the bedrock of enormous change, along with a little bit of ‘green’ feeling around both consumer and corporate responsibility.”

Looking back

Still reflecting on the past, Palmer-Jones continues: “That period was quite progressive and we laid the foundations of where we are now. Even though we have been described as ‘the dirty man of Europe’, we boast 45% levels in domestic recycling and a high diversion rate. In fact, we are certainly higher than average when you look at European comparators.”

Then along came the recession from 2008-13, when the UK government reined in support for the public sector, which had a dramatic effect on the services it provides and the investment it can make.

Where does that bring us?

“Looking at the drivers going forward, all we can see is the debate about Europe and how instrumental it is in defining our future,” states Palmer-Jones, who recently personally warned in a Sky News interview that a vote for the UK to leave the European Union could jeopardise billions of pounds in infrastructure investment.

Along with the possibility of Brexit, the dearth of waste policies from the government (especially with no mention of the industry in Defra’s five-year environmental policy plan released last month, apart from one mention of new approaches to tackle waste crime), Palmer-Jones says “it is telling that they could separate us from their future actions”.

The other major obstacle to the waste sector being able to move onto the ‘next stage’ is the volatility of the commodity market.

“We have moved on from the simple model where we collected waste and took everything to landfill,” continues the CEO, who is now getting into his stride. “Now we are waste factories producing secondary raw materials and energy. There is added pressure in that if you don’t produce energy or extract value on the day, that day is lost. This means we are in the manufacturing industry with all the risk and complexity of meeting two customer bases: the front-end customer and the customer at the back end. Added to which, we have to analyse the value of the materials we’re collecting, price it and then take it through more and more complicated logistics, such as turning it into refuse-derived fuel (RDF) or solid recovered fuel (SRF).”

By selling the secondary raw material on to a local or world market, the CEO poses the rhetorical question – and one which has exercised the minds of many companies in the waste sector – ‘How do you pass that difference in price to the customer? Do you filter the effect back to the original customer?’

External influences

“Our economics are influenced by the huge amount of capital we have invested,” states Palmer-Jones. “Now we are exposed to geo-political movements in the world.”

He pauses before adding with a smile: “I used to watch TV for the football results. Now you wonder what world catastrophe or political incident is going to change the dynamics of the market. The world is far more volatile nowadays.”

Now that the cash cow that was landfill is becoming increasingly unavailable and reinvestment is needed to take the waste sector to the ‘next level’, the CEO warns of the new thinking and skills that will be required by the new approach.

“I can see all these things, all the taxation, pressure from legislators, resulting in landfill not being a good business to be in. Maybe the pace of closure of landfill will go a lot faster than the government anticipates, and what with saturated RDF and SRF markets, what will happen next?”

When Palmer-Jones took over in 2008, SUEZ had more than 20 landfills in its portfolio. “Now we will only have three to four,” he says. “So if landfills are no longer available, residual waste will have to travel further and further. And then what?”

European challenges

And while the CEO is personally in favour of the UK staying within the EU, he is by no means blind to the problems Europe has created.

“When I look at Europe, its self-sufficiency is poor. It is the biggest importer of raw materials, and exports its own raw materials, so the equation doesn’t add up. We need a harmonious symbiosis, but people can’t see the scarcity of materials that faces society, and the difficulty is how to materialise the danger ahead of us.” Palmer-Jones suggests attributing the extraction of the materials both economically and environmentally and then matching it with the circularity of the materials; thereby reducing the burden on raw materials.

Once again he warns of the waste sector’s inability to move away from the linear system. “We will remain in a limbo where we can’t make the step to the next stage.”

But it’s not all negative, according to the CEO. “It’s exciting how we can help in getting to the next stage. For instance, engineering materials from waste. Post-2030, I hope to be talking about commercial customers who are looping their materials back to base materials to control their input and quality.”

However, he returns to the issue of delivering the vision. “We need a bit of assistance and while companies like SUEZ take a risk in our investments, we need strong policy leadership. It’s not enough to rely on the market, otherwise you end up with a similar situation in the US where paper is no longer recycled because the price has dropped.”

With his job at SUEZ, presidency of the European Federation of Waste Management and Environmental Services (FEAD), responsibilities as a WRAP trustee and speaker slots at industry events, there is little likelihood that Palmer-Jones is going to take his foot off the pedal any time soon, but come the day when he leaves the waste management sector, what would he like to think would be his legacy?

No more talk of waste

“The one I always trot out is that it would be great to think we don’t use the word ‘waste’, because we’re not; we are dealing with materials and energy. We are the resource industry and aligned with bringing resources back in and being at the heart of the circular economy.

“However, I’m not sure I will see that in my career. Also there is the issue of pricking the conscience of politicians to help us make the transition. Making them aware and putting into place the policy to give the industry the leverage it needs.”

David Palmer-Jones CV

David Palmer-Jones has worked for SUEZ recycling and recovery UK for 27 years. He joined the company in 1989 following a short time working in local government.

Palmer-Jones began his career in the UK with the then SITA UK before a short time in Malaysia, two years in France – in Paris and Normandy – and a further 10 years in Sweden, latterly as the CEO of the Swedish operation.

He returned to the UK in 2006 working initially with industrial and commercial customers before becoming SUEZ recycling and recovery UK CEO in 2008. Palmer-Jones transformed the way the company views the management of waste for its customers, moving towards a resource-efficiency and recycling-led approach which embraces the circular economy.

Currently president of FEAD (European Federation of Waste Management and Environmental Services), he is also a trustee of

WRAP, having been appointed to the board in 2009.

From 2012 to 2014, he was chairman of the Environmental Services Association and remains a key public commentator on recycling, waste management and resource efficiency issues.

Five things I can't live without...

Family

My family comprises my wife Rachel, son Frederik and daughter Charlotte. Both children were born in Sweden. My time in Scandinavia has also had a bearing on my perspective in waste. My family laughs at me when I say “I’ve seen the future”.

Nature

I have a great sense of pride that the waste sector is contributing to

the protection of the environment.

Humour

I like having a laugh, even in bad situations. Having a crack with people

is great.

Exercise

I go to the gym about three times a week. It is more to do with sanity rather than physique because you can’t think when you are pushing the weights on the machine. It de-stresses you.

Rugby

I am a big fan of WASPS and avid fan of rugby. I also enjoy watching my son play rugby.


This material is protected by MA Business Ltd copyright.
See Terms and Conditions.

Comments
Name
 
Email
 
Comments
 

Please view our Terms and Conditions before leaving a comment.