Small waste firms in Auckland, New Zealand have commissioned a report to fight Auckland Council’s plans for the city’s NZ$600 million ($524 million) landfills and waste stations that they fear will squeeze them out, according to the Sunday Star Times.
There are as many as 30 waste management operators, including small collection and recycling firms in the region. It is these smaller waste companies that have commissioned their own analysis of the proposals from Wellington law firm Franks & Ogilvie, which concludes the council hasn’t done enough analysis and could generate “major costs”.
The newspaper report says that the small firms are worried that the plan will favour a city-run monopoly using only major players Transpacific Industries and EnviroWaste Services.
The city is currently reviewing its obligations under the Waste Minimisation Act 2008 and is said to favour a plan to take operational control of waste. Its preferred scheme is a joint venture with Transpacific and EnviroWaste, though nothing definitive has been decided yet, according to a council report on its draft plan.
In March the council’s regional development and operations committee agreed to support a plan to take control of the 85% of the waste-stream it doesn’t control, probably through some type of public-private partnership with major waste players Transpacific and Ironbridge’s EnviroWaste.
Following the user-pays model, the council thinks it can cut trash going to landfills by at least 40% through a monopolistic joint venture, also reducing the cost to households.
However, according to research by Alex Sundakov of Castalia Strategic Advisors - commissioned by Franks & Ogilvie - those claims fail to stack up. Sundakov says the council hasn’t received good policy analysis, and that “there is currently no basis for making an informed decision” on the future of waste.
The council claims that under its proposal, households about one quarter the cost of the next cheapest option, or 81 cents a week. Sundakov says that such claims are “implausible”, and questions the council’s claim that controlling the assets is the best way to keep costs in check.
Transpacific bought Waste Management New Zealand five years ago for $870m, creating the biggest waste disposal firm in Australasia. But according to the Sunday Star Times, has struggled in recent years after taking on too much debt ahead of the global financial crisis.
