UK Waste Construction Market - 2007-2013 (£m)

In 2010, the waste construction market was estimated to be worth £260 million. This represents a growth of 3% on 2009. The waste construction market has experienced good growth in recent years reflecting demand for increased waste treatment capacity. The market is expected to continue to grow in the short term, with average rates of growth of 2-3%.

Factors supporting the market include the need for greater waste treatment capacity as population and consumption increase, increasingly tough landfill diversion targets and expanding speculative development in the commercial market. Factors negatively affecting market growth include government spending cuts, particularly in terms of cuts in funding to DEFRA and WRAP and the removal of waste PFI credits, and relatively new, untested markets for output products. Large European waste management companies entering the UK market are the most significant competitors to the current participants.

Energy from waste, Anaerobic Digestion and In-Vessel Composting remain the sectors with the greatest growth potential in the short to medium term while Legislative changes leading to tougher waste targets have had a beneficial impact on the waste construction market as alternatives to landfill are sought. In addition, increasing prices for recyclables and strengthening markets for other outputs such as energy and compost like output (CLO), have supported the market in recent months. Continued development of new technology sectors will provide an opportunity to add value to the market, as will expansion of commercial and industrial waste treatment projects.

Public sector capital expenditure will fall from 2011. Previous levels of expenditure were unsustainable against the background of public sector debt and the 2010 CSR brought about a significant spending review and a so-called “austerity budget”. Prices for output products are expected to see steady growth as the markets become more established and as manufacturing returns to normal levels and demand increases, particularly from the expanding markets of India and China.

The waste construction market is expected to continue to grow in 2011 as a number of PFI contracts signed in 2009 and 2010 see construction begin on new waste facilities. From 2011, the market is expected to see growth remain low at around 2-3%, although growth is expected to strengthen as economic conditions improve, resulting in a market value in 2015 forecast at £307 million, 18% growth on 2010.